Tax

Ignis converts GBP1.2bn UK Property Fund to PAIF

Ignis Asset Management has converted its UK Property Fund into a Property Authorised Investment Fund (PAIF). 

This follows the unitholder approval received at the extraordinary general meeting held on 11 April.
 
PAIFs are tax-efficient property funds that benefit UK tax-exempt investors, including charities, pension funds and those investing through Individual Savings Accounts (ISAs) and Self Invested Pension Plans (SIPPs).
 
PAIFs are generally exempt from UK tax on income, meaning eligible exempt investors can now receive distributions gross of tax instead of net. This will result in a significant uplift of up to 25 per cent in income returns for eligible investors.
  
To ensure all investors can continue to have exposure to Ignis’ property expertise, the Ignis UK Property Feeder Fund has also been established which will solely invest in the Ignis PAIF.  The feeder fund provides an option for those not able to hold PAIF shares for administrative reasons, and will be available across the major UK fund platforms.
 
George Shaw, investment director, Ignis Real Estate, says: “UK commercial property continues to be attractive to investors due to its income yield, potential for capital growth supported by the improving economic outlook and an asset class that offers clear diversification benefits.  The conversion of the Ignis UK Property Fund to PAIF status will not alter the risk profile or underlying investment strategy of the fund.”
 
Steven Beveridge, commercial and operations director, Ignis Real Estate, says: “The PAIF conversion ensures our offering remains competitive and offers a more tax efficient exposure for many of our investors.  We are now seeing momentum behind PAIF conversions across the sector, with more expected to follow the Ignis UK Property Fund later this year.”  

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