Alternative Investment Market (AIM) shares can be held in ISAs or in a general investment account. Some AIM shares benefit from business property relief (BPR) which means that after two years of ownership they can be outside your estate. AIM shares are small companies often with dominant shareholders and can be very volatile. They are really only suitable for investors with a higher level of tolerance to investment risk.

BPR schemes are built around the Business Property Relief rules. There are a growing number of these schemes. Often these unlisted companies are created to invest into areas where they will qualify for BPR. Typically they are involved in wind/renewable energy, bridging and short-term lending or energy management. Besides the obvious investment risk, they are also very exposed to political risk where a change in policy could make the investments or the products redundant. With what I have seen they offer very little return during your lifetime and the main sales pitch is around the 40 % IHT saved over a two year period. High tolerance to investment risk is required. Get in touch with our Exeter IFA team to find out more about BPR schemes

Before we move onto Trusts, I should just remind you that the new pension rules have brought Pensions into the IHT arena. Pensions don't form part of your estate, prior to taking retirement income the fund value can be nominated free of IHT. Should you die before age 75, your beneficiaries can now receive a tax free income or lump sum. Post 75, they may be taxed at their marginal rate which could be lower that the inheritance tax rate.