Quilter International Collective Investment Bond

The Collective Investment Bond is a typical offshore investment bond, and does not permit the holding of highly personalised assets, which is good for both UK residents and returning UK residents. 

This is largely because when a UK expatriate returns to the UK, it is essential to “endorse” the offshore bond so that they can continue to benefit from tax deferred gains.

If you fail to endorse the offshore bond you could find yourself paying income tax on annual deemed gains of 15% of the original sum invested, regardless of whether the investment bond produced any gains.

By instructing the offshore investment bond provider to endorse the policy if you return to the UK, you restrict the invested assets to those which are permissible down to those within a product such as the Collective Investment Bond.

The CIB is issued in the form of a single policy or a number of separate polices known as a “cluster of polices”.

The initial charging term is fixed (based upon the commission and charging structure agreed) at the time of the policy activation and this cannot be varied or waived; therefore, early encashment of the policy results in a “surrender charge” or “early withdrawal charge”.

The Quilter International Collective Investment Bond (CIB) Key Features:

Extensive choice of Quilter International and external collective investment funds and unit trusts, Eurobonds and currency deposits.

• You can transfer in and consolidate other existing collective investment funds or unit trusts (subject to Quilter International Isle of Man Limited’s acceptance)
• Switch funds or make deals on assets when appropriate for you.

Minimums - Lump sum minimum of £25,000. You can make additional lump-sum payments into your policy at any time with a minimum of £2,500. However you will pay any initial fund charges on all contributions.

Currency - Quilter International's Collective Investment Bond payments can be made in a choice of 13 currencies, including Pound sterling (GBP), Euro (EUR), United States dollar (USD).

Eligibility - Quilter International Collective Investment Bond is a regular premium, whole of life, life assurance contract issued by Quilter International (formerly known as Old Mutual International). It is available to most international investors outside of the main regulated territories such as the UK, the USA and Australia. Anyone aged between 18 and 89 (inclusive) can invest into the Collective Investment Bond.

Choice of external custodian - You may request Quilter International to consider the appointment of one or more Authorised Custodians and Dealing Desks, instead of, or as well as, their Default Custodian and Dealing Desk subject to their minimum published investment limit for transfers to Authorised Custodians.

Charges - This would depend on the type of plan you take out from Quilter International as they offer different charging structures largely linked to the amount of commission or earnings being taken by the third party salesman or adviser. They should (but this may not always be the case) provide you with a charges schedule, which will detail: 

• The costs Quilter International levy for setting up and managing your bond
• The administrative costs of the fund managers
• Fees charged by your financial adviser. 

Early surrender - A full encashment will result in exit penalties being applied in the early years through surrender charges linked to the term of the policy. The amount of this charge reflects the cost of Quilter International's set up fee, including any payments (such as commission) made by Quilter International to your financial adviser. This charge may also apply if you cash in part of your bond and the amount remaining is less than either 25% of your total investment, or £10,000/US$15,000/€15,000 (or another currency equivalent). 

Quilter International (formerly known as Old Mutual International) has a great reputation but, in the pursuit of offering flexibility of charging structure to all types of advisers, they have created a product that has the same name but completely different costs.

Those costs are dictated by the adviser and we have seen evidence to suggest that some advisers and adviser companies take the maximum commissions.