Threesixty finds tax friendly new business avenue for advisers

Support services provider threesixty says it has opened up a profitable avenue for new business for advisers, following a tie-up with Margetts Fund Management that will allow corporate clients to invest in its unit trusts.

The deal has come into play following changes to the taxation of company-owned life policies that came out of the 2007 Pre-Budget Report. The introduction of loan relationships rules to all investment-based life assurance policies has meant that companies are no longer able to use bonds to shelter growth, but this has opened up the opportunity of using investment funds instead.

Threesixty has amended the application form for Margett's risk-rated multi-manager range - International, Providence, Venture and Select strategy portfolios - for corporate investors and claims to be the first to provide advisers with the opportunity to invest their corporate clients' monies into funds.

"Not only can you shelter the growth in a unit trust, but you are also benefiting from indexation relief while you do it because that's still applied to corporation tax," explained David Ingram, partner at Threesixty.

"Clearly, there has been an avenue of investment closed off by the Pre-Budget Report and we think we've re-opened it with, in many cases, a cheaper option."

He added: "In the current market, IFAs are tending to look around for new areas that they can start advising on. They're familiar with investments, OEICs and unit trusts and familiar with Margetts, this is just opening up a new channel for them."

Toby Ricketts, investment director at Margetts, said: "Corporate clients may be quite small in number, but generally they are much larger investors [than individuals], so it's a really good market for IFAs and for investment houses such as ourselves to go for."

He continued: "It's a slow process as, following tax changes, there is a whole process of research, education and then, ultimately, the adviser becomes persuaded that the advice they've been giving can be improved and they change the type of product they use.

"We don't expect a lot of business to suddenly rotate out of bonds into unit trusts or OEICs, but I think that with people like threesixty pushing the message, it will get through and slowly but surely we will see that change."

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