Ethical Investment Bonds

Set up a new ethical investment bond or switch an existing bond to something more ethical.

Achieve your financial objectives while having a positive impact on the planet.

Get FCA regulated, independent financial advice to guide you through your options and help you set up a bond using sustainable, ethical investments.

Take meaningful action and avoid investing in fossil fuels, weapons, tobacco and gambling as well as companies with poor human rights records and questionable business practices.

Our carefully selected range of ethical investments includes award winning sustainable funds, portfolios that use a blend of ethical approaches (ESG + SRI etc.) and dark-green ‘Impact’ funds & portfolios that are helping to solve the many problems facing our world.

Get in touch today for a free review of your existing bond or to speak to one of our advisers.

Call 023 8000 3456 , email: help@ethical.money or complete the form.

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Investment Bonds

Investment bonds are single-premium life insurance policies.

A lump sum can be invested in a choice of available funds with the potential for medium to long-term growth.

Funds are available to match a range of ethical preferences (avoiding fossil fuels, weapons etc.) and can be selected to create an ethical investment bond.

Bonds can be a useful tax planning tool because they allow withdrawals of up to 5% of the initial investment each year without triggering any immediate income tax liability.

For succession planning they can have multiple ‘lives assured’, including children, meaning the policy can remain in force until the death of the youngest life assured.

Income tax becomes payable when the bond is cashed in or matures which, is particularly helpful to higher rate taxpayers who want to delay paying tax until they fall into a lower tax band, such as in retirement.

Create an Ethical Bond.

Most investments can now be made ethical, either by selecting pre-existing ethical funds and model portfolios to make up the underlying investment or for larger investments, a completely bespoke portfolio can be created.

A considerable number of pre-existing ethical funds and portfolios exist developed using a variety of ‘screening’ techniques to either exclude certain industry sectors and companies or include industries and businesses with a focus on sustainability, good governance and environmental factors.

By working with you to ascertain your ethical preferences and desired outcome, both in terms of environmental impact and performance, we can help you choose suitable investments for the savings in your ethical investment bond.

Off-shore vs On-shore Bonds

On-shore bonds are subject to corporation tax on most of their income at the rate of 20%. Rent and some other forms of income are taxed at 22%, as are capital gains.

Most off-shore bonds are based in tax havens and consequently any income and gains will normally be free of tax. In the absence of tax they are considered to have the potential for better growth.

In the hands of the policyholder, chargeable gains from on-shore bonds receive a credit equivalent to the basic rate of income tax due to the tax on the underlying fund. Therefore, only higher rate taxpayers are liable for further tax.

Off-shore bond gains are liable to tax at the policyholder’s highest rate of income tax. They are liable to basic rate tax as well as higher rate to compensate for the lack of UK corporation tax suffered by the underlying fund.