AIM shares and ISAs

In the 2012 Autumn Statement the Chancellor announced that the Government would consult on expanding the list of qualifying investments for stocks and shares ISAs.

In March, HM Treasury announced a consultation about how to implement this policy.

Significantly, this consultation does not ask for views on the core question of whether or not to expand the range of ISA qualifying investments to include AIM shares. The Government has already decided it wants to introduce this policy in order to stimulate investment in smaller companies and the consultation is thus focused more narrowly on questions of practical implementation.

In summary, the Government is proposing that AIM quoted shares will qualify to be held in stocks and shares ISAs, whilst continuing to qualify for Business Property Relief and exemption from Inheritance Tax.

Under these proposals investors would be able to retain their existing ISA wrapper and the associated income tax and CGT benefits whilst potentially removing assets from an estate for Inheritance Tax purposes after a minimum two-year holding period.

Create director Peter Davies is therefore waiting to hear more on the Government’s decision.

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