Premier Europe Women

Premiere Europe Account


  • Age 42.
  • Higher rate taxpayer.
  • Has built up an investment portfolio worth £550,000.
  • Wants to retire at 55 and expects to be a basic rate taxpayer at that time.
  • Likes to use a discretionary investment manager to look after her portfolio.

The Premiere Europe Account

Katherine is a successful businesswoman and has managed to build up an investment portfolio and due to the income generated she recently became a higher rate taxpayer.

Working with her professional adviser, Katherine plans to retire at 55 and is looking to restructure her investments to provide a flexible tax-efficient income at that time. She already has sufficient pension provision in her employer’s scheme, but this will not pay until she reaches 67. She wants to retire early to travel, so is expecting her expenditure to be high.

Following conversations with her professional adviser, Katherine decides to move a large part of her portfolio into a Premiere Europe Account with Canada Life International Assurance (Ireland). This is a series of identical international investment bonds where the underlying investments can grow free of UK income and capital gains tax.

Katherine finishes work at age 55. Her income then drops and is made up of some investment income which just about covers her personal allowance and the dividend allowance; however it is insufficient to meet her expected expenses.

As the Account is made up of a series of identical policies, Katherine cashes-in enough to use up the savings rate of income tax which provides her with more tax-free income. She is able to supplement this through withdrawals from the remaining policies. For tax purposes these withdrawals are treated as a return of capital so there is no immediate income tax liability.

This flexibility allows her to fulfil her ambitions by generating money to use until her pension becomes payable at 67.

 Key benefits

  • The investment can grow free of UK income and capital gains tax, deferring the potential liability until the policies are cashed-in.
  • Any tax liability when cashing-in policies is based on her tax position at that time, allowing her to use the savings rate of income tax and avoid any higher rate income tax.
  • She is able to take tax-efficient withdrawals from the policies.
  • The Account offers full open architecture investment, including the ability for a discretionary manager to run the underlying portfolio.
  • Policies can be assigned to new owners or into trust and providing this is done as a gift there is no income tax charge.

On Katherine’s death

  • If there were surviving lives assured on the policies then the policies will continue and form part of her estate. The policies can be assigned to the beneficiaries of her estate by her executors.
  • If she was the last life assured then the value of the investment will be paid to the beneficiaries of the estate and any growth could be liable to income tax, spread over the investment term.
  • The value of the policies could be subject to inheritance tax unless they were placed under a suitable trust.


In this instance, Katherine survives well into her eighties but had continued to draw money from the investment by cashing-in the policies. The tax liabilities were applied each year and although she had to pay some basic rate income tax, the profit was spread over the investment term minimising the tax payable.


Important information

  • The value of investments can fall as well as rise and you should speak to a professional adviser to ensure that any investment is suitable for you.

Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.

Canada Life International Limited and CLI Institutional Limited are Isle of Man registered companies authorised and regulated by the Isle of Man Financial Services Authority.

Canada Life International Assurance (Ireland) DAC is authorised and regulated by the Central Bank of Ireland.

Stonehaven UK Limited and MGM Advantage Life Limited, trading as Canada Life, are subsidiaries of The Canada Life Group (U.K.) Limited. Stonehaven UK Ltd is authorised and regulated by the Financial Conduct Authority. MGM Advantage Life Limited is authorised and regulated by the Financial Conduct Authority.