Investment Bond:

A unit linked single premium whole life assurance policy. Part of the premium gives life cover whilst the balance is invested in unitised funds. Under some circumstances, since the bond is a life policy, certain tax advantages may be enjoyed.

For example if the capital and annual interest are reinvested in full, there is no immediate liability to higher rate tax. If the proceeds of the bond are subsequently taken when a former higher rate taxpayer has become a basic rate payer, there is no higher rate tax liability.

The values cannot be guaranteed and can go up as well as down.

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