Tax Efficient Endowments

There are similarities between unit trust investments and endowments.  Their main difference lies in the fact that the proceeds from an endowment are paid tax free to the investor after the investment term.

An endowment may therefore make sense for individuals who have a marginal tax rate of greater than 30% since proceeds are taxed at a rate of 30% inside the endowment. An endowment makes even greater sense when an investor utilizes his or her full annual tax-free interest income exemption.

Endowments and unit trusts are both popular after-tax investment vehicles, but how can you determine which one is most appropriate for you? Talk to us at AMBITON and we will assist you in making the right decisions.