The Collective Investment Account (CIA) is an Onshore Investment Account that is designed to take full advantage of the CGT allowance, investing in low-risk assets, which are realised at the optimum time.
This UK-based platform is generally used for approximately £200,000 of client assets per person (£400,000 for a joint account).
Each UK individual is entitled to an £12,000 Capital Gains allowance (2019/20 tax year), which can be used to soak up most investments that make a ‘gain’, including investment property, Shares and Gilts.
This account is used to absorb a person’s annual Capital Gains allowance, essentially meaning that the first £12,000 (for an individual) of capital gain in the portfolio would be free of Capital Gains Tax, once the funds are sold and the gain crystalised. We can manage your funds to trigger this.
As well as Capital Gain, growth is also made up by income from Dividends, allowing for the utilisation of Dividend Income Allowance (currently £2,000 per annum)
Of course, we would only use the Capital Gains Tax allowance if it was not being taken up by the client elsewhere within their overall asset base.