If you are looking to find out more information about a personal investment company then continue reading our article we go into full detail on what a PIC is and how you can set one up.
A Personal Investment company, or (PIC), is a private company that is most commonly used for long-term financials. A PIC holds cash deposits, investment funds, share portfolios and rental properties. PICs are a viable alternative for investors who usually carry out trading activities personally.
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You can use a PIC for business planning and saving money while doing so. A lot of business owners struggle to withdraw large sums of money from a private trading company without being heavily taxed on it and being able to trade close to the net asset value.
If you’re taking money out of your business and it’s not for personal expenses, using a PIC instead can be a better alternative for long-term financial investments as a long-term investment vehicle.
You can use PICs to plan retirement effectively. As private investment companies are for long-term investing, you can use them for retirement dividends by lending money to the PIC for it to pay you back tax-free.
If you want to pass on wealth to the next generation, then holding shares within a PIC could be the best option.
Using a PIC to fund university costs is another way of making savvy investment choices. Adults going to university can become shareholders and, as a result, get dividend income from a PIC. Depending on the level of this income, they can also benefit from not paying tax on the dividends.
You can save up to 40% in taxes by using a PIC that allows for your investments to grow and be paid as part of retirement living costs.
The main business of a PIC is to make investments more tax-efficiently. PICs can be used for risk management, spreading the risk of wealthy individuals who invest regularly.
PICs have several tax benefits, meaning they are a great investment portfolio option. Namely, the fact any dividend income is non-taxable most of the time, and any gains are taxed at 19% as it stands.
Gains and income earned from investing can be paid straight into a pension plan for tax purposes, and any losses incurred from rental income can be balanced against any other income. Finally, Management fees and fees relating to the portfolio can be accounted for and subtracted from tax.
There are several key advantages to using a PIC:
Yes, as an individual, you are eligible to create a personal investment company as a private company you can use to hold your invested stocks or secure bonds and stocks. Any money you choose to invest will be put in the company’s bank account.
Structured as a partnership, a private investment company issues a fixed number of company shares within a limited timeframe. These shares are invested in commercial properties, venture capital, and private equity. In the United States, most investment companies are regulated and registered with the Securities and Exchange Commission (SEC) and are widely known as a “fund company” or a “fund sponsor”.
A private or personal company that invests from the combined pooled capital of investors. These investors usually specialise in a specific market or industry, such as property investment.
A few examples of personal investments include money market funds, mutual funds, government bonds and index funds. High-yield savings accounts and certificates of deposit are also good examples of private investments.
Similar to mutual funds, unit investment trusts (UIT) that trade shares on the stock exchange can be redeemed as units or shares held by the unit investment trust or can even be resold to the investment company.
Investments in something by a person instead of companies or firms. Such as real estate or precious metals. Private investments are an effective way to get your money to work for you in the hope of building wealth.
TaxBite chartered accountants are experts in personal investment companies and unit investment trusts. If you’re curious about formulating your own personal investment company and don’t know where to start, our accountants are available to help you today.
Whether you need assistance with mutual funds, private equity, investment growth, liquid assets, or even open-end funds, our advisors can help shed some light on how formulating a personal investment company can be beneficial to you.
We also provide our clients with financial plans that cater to their growing needs, unique requirements and current portfolio. While most investment managers have a standard approach to investing for their clients and their retrospective investment companies, we pride ourselves on a more detailed approach.
If you’re looking to invest, start an investment business, secure your future assets, or are interested in building an investor’s portfolio, our team would be more than happy to advise and help you manage your assets or wealth. Whatever your circumstances, deciding to secure your assets or just to begin investing can be a great way to become more tax-efficient.
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Click the link below to talk to us and get professional advice about private investment companies. With one of our chartered accountants, investors can start their personal investment company today. If you’re looking for tax-efficient ways to fund retirement, university, or property investment, then a personal investment company might be the best way forward.
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