IHT RULES IN FRANCE & SPAIN

WAY warns of IHT confusion abroad.

Confusion over Inheritance Tax rules in France and Spain spells bad news for expatriates and investors thinking of buying abroad.

That is the warning from IHT planning specialist WAY Group, which says more and more people are eyeing up the popular retirement destinations. The fund manager and wealth solutions planner says it has had an increase in enquiries from investors and expatriates concerning high taxation laws in Spain and France. According to WAY, Britons must be aware there is no exemption beyond the €Euro 76,000 personal allowance on transfers between husbands and wives on death and, according to the Institute for Public Policy Research (IPPR), there are around 200,000 expatriate Britons living in these countries.

Paul Wilcox, WAY chair, says: "This could mean many Brits will be vulnerable and if assets go directly to the children, each child only has a personal allowance of €Euro 50,000.

In France in particular, Wilcox says, a tax anywhere between five and 40% will be levied and many Brits are clueless to the fact children have more rights than the spouse under French law!

However, WAY adds, French tax authorities also have a system known as "assurances-vie", which will allow unlimited amounts to be sheltered from punitive Gallic IHT laws. But, it adds, it is important to set up an IHT mitigation plan before taking up residency.

Please Note: This commentary was first published by IFAonline, part of the Incisive Media group, on 28th June 2007. Author: Lavina Suthenthiran. Reproduced with kind permission.

Note: This commentary has been prepared for Financial Intermediary Clients and Professional Associates of WAY Investment Services Ltd and is not intended for and must not be distributed to Private Investors. This information is supplied to you in confidence and you may not pass it on to any other party without prior written consent. Past performance is not necessarily a guide to future returns and changes in rates of exchange between currencies may cause the value of investments to rise or fall. No representation or warranty is given (express or implied) as to the accuracy, completeness or correctness of the information nor the opinions, interpretations and conclusions contained in this commentary. The commentary does not constitute investment advice or a recommendation to purchase or sell any security. Neither the author nor WAY Investment Services Ltd accept any liability whatsoever for any loss or damage arising in any way from any use of or reliance placed on the commentary. WAY Investment Services Ltd is an Appointed Representative of WAY Fund Managers Ltd which is authorised and regulated by the Financial Services Authority.

Press Release Date: 28th June 2007