View more on these topics

Gibbs to head merged Jupiter trust

Jupiter is planning to merge three split-capital investment trusts and relaunch them as a single tax­efficient trust managed by Philip Gibbs.

Tony Nutt’s Second Enhanced Income Trust, Gibbs’s Second Split Trust and the Defined Capital Return fund, a pas­sively managed, Jersey-domiciled vehicle, are the affected funds.

The combined assets will create a vehicle with more than £200m under management. It will be structured in a similar way to Gibbs’s existing trust and will have an absolute return objective.

To give the manager as much freedom as possible, the fund will not have a yield target.

Richard Pavry, the head of investment trusts at Jupiter, says: “Second Enhanced Income has been managed with a higher income requirement than we would expect from now on. Gibbs will aim to generate absolute returns, whether income or capital. By not constraining him to a given target yield we are giving him maximum flexibility.”

Nutt will continue to manage his Dividend & Growth Trust as well as his open-ended income funds.

Pavry says all three trusts will reach the end of their planned life on October 30 and in each case shareholders have the option to take cash or roll over into the new vehicle.

The 50% higher-rate income tax band, introduced in the last
Pre-Budget Report, will create a real incentive for investors to move to investments classed as capital rather than income and, therefore, attracting capital gains tax at only 18%, Pavry says.

To that end the new closed-ended fund will offer both zero dividend preference shares and geared ordinary shares. There will also be a third share class called a packaged unit, allowing investors to own both one zero and one ordinary share in a single unit.

“While a zero dividend preference share pays a yield of perhaps 6%, it is paid as capital rather than income, which could make it quite attractive from an adviser point of view,” Pavry adds.

The proposals are still being finalised, but if approved by shareholders and the regulator, the merger should go ahead towards the end of the year.

Related story:
Jupiter reveals Japan Sicav details



Govt funding extended for ISO 22222

Government funding for selected financial advisers to obtain ISO 22222 through Standards International has been extended for a further year, following the Government’s Train to Gain initiative.

Tim Jones

Who knew that the man heading the development of a pension scheme that could revolutionise retirement saving was once the lead singer in a rock band with a single played on Radio 1?

Planning now for the residence nil-rate band

Graeme Robb, senior technical manager at Prudential, writes about the residence nil-rate band and the advice opportunities it presents for you when tax year-end planning with your clients. On our Planning Matters hub, we considered a widow, Margaret, and a married couple, John and Anne, for whom the residence nil-rate band (RNRB) is influencing planning […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment