Personal Equity Plans (PEPs)
Background
Personal equity plans (PEPs) were tax-efficient investments available in the 1980s and 1990s. Many people invested in PEPs and many still have investments in PEPs now. The tax rules have changed since PEPs were withdrawn but there are still investment options you can explore without losing your PEP's tax advantages.
Personal Equity Plans (PEPs) were available for investment between 1987 and 1999, allowing you to enjoy the profits from stockmarket related investment free of income tax and capital gains tax. Since then the rules have changed and the tax-shelter umbrella offered by PEPs is now similar to that offered by Individual Savings Accounts (ISAs).
You may no longer invest fresh funds via PEPs. The PEPs scheme was withdrawn with effect from April 6th, 1999, the start of the 1999/2000 tax year. However, any savings already invested or sheltered in PEPs at that point are allowed to remain in PEPs.
Many of us are likely to have built up our PEPs portfolios on a piece-meal basis and it may be time we reviewed our holdings. Had you invested the maximum allowable each year into PEPs you would have been able to shelter a total of £88,200 from the taxman - a sum which could by now have grown considerably.
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