Select Account

Frequently asked questions

• Can the owner of the bond be changed?

  Yes, and if the bond is gifted then there is no chargeable event. However, if the bond is sold or a benefit has been gained, there will be a chargeable event and there could be an income tax charge.

  A chargeable event is the name for certain things happening or money being taken out in a certain way. A calculation is done to see if a chargeable event has created a chargeable gain which might mean there is tax to pay.

  When you assign segments to someone else, they will be in scope for inheritance tax – unless covered by an exemption (for example, gifts between spouses/civil partners).

• Can a company invest in a Select Account?

  Yes, a company can take out a Select Account.

  The company will be taxed according to fair value or historic cost. An accountant will need to look at how the company is taxed to see which applies. In general, larger companies use the fair value basis and very small (micro-entity) companies can use the historic cost basis.