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Morfitt & Turnbull

Issue 5   

Mulligan’s Morning Moos

For those of you that have visited us here in Knutsford then you will know we have the privileged setting of office space in the grounds of the Booths Hall estate. We are in the Booths 01 building which in the short walk from the carpark often provides the diverse sounds of planes in/out of Manchester airport or the mooing cows from the adjacent farm buildings!

As for the estate itself, its colourful history revolves around the infamous John de Legh. Although his guilt was never in doubt, he was pardoned for crimes including the looting of Manchester, murdering 7 people, killing his neighbour, stealing cattle and ravishing a lady in 1332! Such activities are not too commonplace at M&T!

Some feedback please...
In the last issue I mentioned that we are hoping to get your thoughts on what we do, good or bad, so that things within M&T continue to improve - with this in mind we're asking you to answer the following:

What would you say to someone else who asked you about us?

Please reply back to on this or any other aspect of M&T.


Equalisation - that's level pegging to you and me...
Over the years, especially in more recent times, there has been increasing occurrences of equalisation brought about by legislation. This affects our industry too and changes are afoot...

At present, in simple terms, the financial industry uses many factors - one being gender - to calculate how much is paid for life/health insurance and the level of pension income received in retirement. A recent test case at the European Court of Justice ruled that discriminating on the basis of gender is illegal, i.e. the calculations cannot make a difference on the basis of being male or female. So what does this mean?
    On the back of that case, the laws will change from 21st December 2012 meaning rates will no longer differ on the basis of gender, although other factors such as age and health will continue to have an impact. Ok, so what does that mean???

Well currently it's the ladies that are outliving the gents so their life insurance policies tend to be cheaper as they are less likely to claim. 1-0 to the women!

However, they are likely to be paid a pension income longer in retirement so the starting income tends to start at a lower level. 1-1 (the "equaliser"?!).
How will the rates change then? Will pension income be better for women or worse for men and are life insurance premiums going to favour women or increase for men? Sadly there are no answers as yet as the insurance companies are still calculating the impact and it is unlikely to be known until the last minute, i.e. in December!

In the meantime if you are looking at life insurance or retiring soon though, please call to discuss this as you may secure a better rate now rather than waiting.

Adam’s Technical...
Article number 3 - on IHT!
It's yet another Inheritance Tax (IHT) planning option from Adam – now that's the third mailshot article in a row so do have a read through and see how you can possibly tackle this most unfair of taxes...

My last IHT planning article on Discounted Gift Trusts was a solution for individuals who needed regular income and were comfortable giving up access to the capital.
This solution, the Loan Trust plan, is perfect for those who wish to give away the growth on their capital and have the peace of mind that their capital can still be accessed at any time in the future.

With a Loan Trust plan, a trust is created and an interest free loan is then made by you to the trustees whom you appoint. This "loan money” is then invested by the trustees in an investment bond to aim for long-term capital growth. The trust can either be on a discretionary or absolute basis and we will look to arrange the most appropriate one for you.

The rules are that any future growth on the bond falls immediately outside of your estate for IHT purposes and on death will be paid to the chosen beneficiaries. Crucially, if you need access to some or all of the capital or a regular income, this can be arranged at any time. However any of the original investment remaining in the bond on death is returned to your estate and therefore may itself be subject to IHT.
The key points to note with the Loan Trust are:
  It suits individuals who want to plan for IHT but not wanting to gift away capital.
  The initial amount invested can be repaid fully or in part at any time.
  Any investment growth on the loan amount invested is free from IHT and paid to your beneficiaries on death.
  Any original capital still invested in the investment bond on death is returned to your estate and may be subject to IHT.

If you wish to speak to us regarding Inheritance Tax planning and your options then please contact your Adviser at Morfitt & Turnbull on 01565 624370.

Gareth Says... 
Did you know???
A topical piece of financial trivia from Gareth in this edition…

"Following the recent celebrations of the Queen's Diamond Jubilee I thought I would share these interesting facts with you regarding the financial markets...

The only companies in the FT30 index (as it was known back then) in 1952 that are still in the FTSE100 index today are GKN, Imperial Tobacco, Rolls-Royce and Tate & Lyle. Back then the index was mainly made up of UK companies engaged in industry such as the British Motor Corporation, Lancashire Cotton and United Steel.
There were no banks, oil companies, pharmaceutical stocks or miners in the main index. BP was the first oil company to join the index in 1977 and the first bank, NatWest, did not join until 1984!"  

Staff Matters - and you matter!
You will have realised by now that as a team we look to include a tiny bit of light relief into working life at M&T. Last year this included the M&T Fantasy Football League (and yes, Gareth won it!).

So towards the end of July, next season's league will be set up and we would now like to include you! If you would like to be part of our league then please let us know so we can send you the details.

A separate email will be sent in a few weeks' time with joining instructions so please feel free to get involved. It's all a bit of fun (except for those competitive ones amongst us!), no footballing knowledge is required and no cost involved.

As a little incentive we're offering a one-off prize of £100 to the winner at the end of the season too!


No. 1 Booths Park, Chelford Road, Knutsford, WA16 8GS
Tel: 01565 624 370   Email: 

Morfitt and Turnbull (Management Services) Limited 
Authorised and Regulated by the Financial Services Authority.
Registered Number 740613 England

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