Acuity, formerly the UK smaller companies team of Electra Partners, is launching a new IHT service targeting investors whose estates face inheritance tax (IHT) liabilities upon death, offering effective tax mitigation and the potential for capital gains.

Acuity will construct and manage a well-diversified portfolio of AIM-traded equities which qualify for business property relief (BPR). After a holding period of two years, the portfolio should qualify for 100 per cent relief from inheritance tax.

This structure allows investors control and access to the funds invested, which is in contrast to many other IHT planning tools that require gifting or locking-away investors’ capital for longer periods of time.

Acuity's Protected ITS features a choice of life assurance levels to best suit investors’ needs and presents a number of key advantages, including automatic life assurance for investors up to the age of 70 to cover any reduction of up to 20 per cent in the value of the initial net amount invested (less any withdrawals), with no health check or pre-screening necessary.

Judith MacKenzie, principal fund manager of the service, says, ‘Our proactive private-equity style investment strategy has been rewarded with a strong track record on AIM. Accordingly, this service combines tax efficiency and a good investment opportunity. It is a flexible service that will also allow investors to apply for a level of protection that best suits their individual investment preferences and circumstances.’

The service has a competitive annual management charge of 1.95 per cent per annum. Investors can invest a minimum of £50,000. The manager will select approximately 25-30 qualifying AIM companies from a diverse range of sectors.

Ben Yearsley, investment manager at Hargreaves Lansdown says, ‘The Acuity management team has proved over a long period of time that they have the expertise and process to outperform. AIM remains an exciting place to invest with many top quality companies. Investing in AIM is Acuity’s specialism and a natural extension is to launch an inheritance tax service.’