Prudential International Investment Portfolio

If your client invests in this product they should read our Key Information Document, relevant ‘Investment Option Document(s)’ or Fund Managers own Key Investor Information Document(s) as appropriate. Please note that if the fund manager is not Prudential, your client will need to source these documents from the fund manager directly. These include important information which may help them make up their mind.

The Prudential International Investment Portfolio is a single premium unit-linked investment contract with open architecture available as either:

• A Life Assured version - a whole of life assured contract written on a single or joint lives last death basis, or

• A Capital Redemption option (CRO) - a non-life assured contract with a fixed term of 99 years

The portfolio allows access to a wide range of investment choices with the aim of increasing the value of money your clients invest. It offers a wider choice of funds than the Prudential International Investment Bond.

A single premium of at least £50,000 (or currency equivalent) is the minimum investment level for the bond to be taken out. The minimum top up premium is £5,000 (or currency equivalent). 

For the Life Assured version, there is no set investment term of the Bond. Both versions are set up as a group of identical policies, normally 20, available up to 100. Your clients can choose to cash in each policy separately, helping them withdraw money in a tax efficient way. The plan comes with a small amount of life cover and will pay out a lump sum when the person, or people, covered dies. 

For the Capital Redemption option, the Bond has a fixed term of 99 years, although it can be encashed at any time. If it is continued for the full term, it will pay a guaranteed minimum amount at maturity. This option can be particularly attractive for trusts, allowing the trustees to choose when to cash it in or instead keep it going through successive generations. 

The Prudential International Investment Portfolio also allows you or your client to appoint a Discretionary Asset Manager (DAM) to manage all or part of the Bond. We have five DAM partners, selected for their experience in the adviser market

This is where any cash balances are held in the Bond. The cash account is used to buy Assets for the Bond, receive cash income from Assets, meet bond charges, any regular or one-off withdrawals and adviser charges.

For more information on the Cash Account download the Key Features document (PDF).

The Prudential International Investment Portfolio has the advantage of being tax-efficient in a number of ways to minimise any tax liability and defer tax until the bond ends, such as when it's cashed in.

For further tax information and what this means for your clients, download the Key Features document (PDF).

The Prudential International Investment Portfolio can be written as the following trusts if your client requires Inheritance Tax Planning advantages.

• Discounted Gift Trust*
• Loan Trust*
• Gift Trust*
• Excluded Property Trust
• Probate Trust
• Bare Trust for Settlor (PDF)

* Absolute and Discretionary.

The owner of the bond must be a UK resident and at least 18 years old at entry.

Life Assured version

• Single life basis - minimum age at entry is three months attained and maximum age is 89 years.
• Joint life last survivor basis - Up to 10 lives assured, minimum age at entry is three months attained and at least one life assured must be less than 90 when the bond is taken out.

Capital Redemption option

Available for individuals, trustees and corporate investors.

• Initial premium: £50,000 (or currency equivalent)

• Additional premium (top-ups): £5,000 (or currency equivalent)

• Minimum investment in each fund: As set out by the fund manager

Clients can:

• cash in the bond at any time
• take regular withdrawals - monthly, quarterly, four-monthly, six-monthly or annually
• take a one-off withdrawal as a specific amount
• withdraw up to 5% per year, free from any immediate income tax liability.
  

The minimum withdrawal, of any type, is currently £500 (or currency equivalent).

If your clients decide to invest and take withdrawals, there is a choice of investment currencies to suit their individual circumstances.

Download the Fast Facts Document (PDF) for more information.

Your client can put money in and take it out in any of 11 currencies. Changes in the rates of exchange between currencies may cause the value of your client's investment or income to go down or up.

A full list of currency choices can be found in the Fast Facts Document (PDF).

There is a wide range of fund and asset choice available, which your client can manage on their chosen platform. These include:

• Unit Trusts

• OEICs

• SICAVs (Societies d’Investissement a Capital Variable)*

• UCITS (Undertakings in Collective Investments in Transferable Securities) **

* SICAVs are European Collective Investments similar to OEICs.

** UCITS is a generic term for funds that meet certain regulatory requirements and can be sold in any European Union country.

Your client can also invest in cash deposits, with a choice of rates and terms. These provide a low risk option if your client wants a fixed return or could act as a short-term haven if stock markets are volatile. If the need arises to sell investments that are designed for a fixed term (such as fixed term deposits) or that have redemption penalties, this can result in charges being applied by the external entity managing the investment. The application of these charges will adversely affect the value of the investment and could result in a loss being made. 

Our Available Funds and Preferential Terms calculator outlines the funds available. 

Fund switching 

Your client can make up to 20 free deals in the first year, with no charge. Every year after that, they can make 10 free deals. Extra deals may incur a charge unless they involve our own funds.

For more information on fund switching, download our Fast Facts Document (PDF).

Prudential International’s Discretionary Asset Manager (DAM) facility is designed to give maximum flexibility for managing client’s portfolios.

• A DAM can be appointed or de-selected at any time.

• A bond may be split between DAM and non-DAM assets.

• Multiple DAMs may be appointed for the same bond.

We have five DAM partners who have been selected for their experience and commitment to the adviser market.

Applicable product charges include three flexible charging structures and switch charges. For information on all charges, please download the Fast Facts Document (PDF).

• Establishment Charge Option: A percentage of the premium, taken quarterly for five years, dependent on the size of the premium and with a quarterly admin charge. 
• Initial Charge Option: A percentage of the premium with a quarterly admin charge.
• Ongoing Charge Option: A percentage of fund value, taken quarterly and dependent on the size of the premium. 

More information on these three charging options can be found in the Fast Facts Document (PDF).

In the first year of the bond, your client gets 20 free deals. In every year after that, they will receive 10 free deals - each time they buy or sell an investment counts as one deal. We will charge your clients for extra deals, unless they involve our own funds.

If a DAM is appointed, they will make the investment choices and free deals will not apply to assets they manage.

For more details on these charges refer to our Key Features document (PDF).

The level and shape of Adviser Charging is agreed between the individual Adviser and the client.

Prudential International can facilitate the following types of Adviser Charging:

• Set-up Adviser Charge: Deducted from the initial payment before it is invested in the Bond.

• Ongoing Adviser Charge and Ongoing Investment Adviser Charge: These charges can be a monetary amount, a percentage of the amount invested into the Bond or a percentage of the bond value at the time the charge is taken.

• Ad hoc Adviser Charge: After the initial bond is set up, the client can request an ad hoc payment to be made to the Adviser. This can be a percentage of the Bond value or a monetary amount.

Ongoing and Ad hoc Charges are treated as withdrawals from the bond and will count against the 5% tax-deferred allowance.

For more information on Adviser Charges, see our Fast Facts Document (PDF).