Killik & Co, private client stock brokers, have produced a booklet explaining what sort of trusts qualify for inclusion in a Pep.
It sings the praises of self- select Peps, such as the one run by Killik. This does not mean that the investor has to make all the investment decisions. The plan can be run by a manager who will be able to mix and match investments, including investment trusts, unit trusts, shares and even cash.
Each year's allowance - currently pounds 6,000 - can be invested in the same plan. This means that as the plan builds up, you can invest a single large sum in a trust that is 'part qualifying'.
For investments to be fully qualifying they have to be UK shares, or unit trusts, or investment trusts with at least half invested in the UK or the European Union. Partly-qualifying funds include trusts invested outside the UK and EU. Property gilts or fixed interest and money funds cannot be included in a Pep. The part-qualifying investments are restricted to 25 per cent of the value of the plan. On a year-by- year basis this would mean restricting each investment to pounds 1,500. But on an accumulating plan, the investment can be up to 25 per cent of the total.
The guide, which normally costs pounds 5, is available to 'Independent on Sunday' readers for pounds 2.50. Write to Killik & Co, Investment Trust Guide (I/S), Freepost (SW5 030), London SW6 4YY enclosing a cheque payable to Killik & Co.Reuse content