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Build a wood pile

The Kyoto agreement has created an investment opportunity for higher-rate taxpayers who can make an initial investment of 100,000. This opportunity has arisen because commercial polluters of the environment, such as chemical and gas compan- ies, face a punitive climate levy tax on their businesses unless they buy carbon credits.

These can be created by investment in forests which soak up carbon dioxide from the atmosphere.

MTM has launched a tax-efficient investment which profits from this arrangement. This is how it works. MTM will use a leading scientific authority on forestry management to identify deforested land suitable for planting trees which give the highest carbon yield.

Independently, an environmental lender will offer loans of up to 80 per cent of the amount invested. It is expected that at least 90 per cent of the investment will be available for trading loss relief, resulting in first-year tax savings of 36,000 compared with a net investment of 20,000, assuming an 80,000 loan. The benefit in 2009 from selling the future value of income from carbon credits and forestry could give a return of around 450,000. After the loan is repaid, this would amount to a taxable profit of about 360,000.

With the climate levy tax set at 40 per tonne and carbon credits trading at up to 30 per tonne, it is easy to see why polluters would rather acquire credits than pay the tax.

In a short article, it is difficult to explain all the advantages and risks so it is wise to seek further information from Martin King at



I married an alien

Pre-owned asset tax Scottish Equitable International technical manager Margaret Jago warns on spouse-alienation plans

Bridgewater in flexible reversion

Bridgewater Equity Release is launching a flexible reversion plan that enables homeowners to phase the income they draw from their property. Homeowners can take from 25 per cent upwards initially and draw the balance as required up to100 per cent, so gaining from any house prise inflation. Alternatively Bridgewater will take a fixed percentage of […]

Argonaut secures multi-manager backing as it grows 21% in quarter

Barry Norris and Oliver Russ have grown Britannic’s Argonaut European alpha fund by 21 per cent in their first three months and plan a November launch for their equity income product. Since joining Britannic from Neptune in May, the pair have kept the fund 7 per cent ahead of the MSCI European index and won […]


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