With banks and building societies offering minimal interest rates, investing your money with them may be a safe option, but it will not be a profitable one. So it makes sense to find alternative investment opportunities for your money, but the investment market is huge and complex and – as the small print always points out – the value of your investment can go down as well as up. If you’re a beginner to the investment market and looking for a stable investment that’s also tax-free, you would do well to consider fine wines.
Alternative Investment Opportunities You Will Own
Fine wines are a tangible investment. You own the bottles -, you can visit them, touch them, hold them and even drink their contents (although that will obviously reduce the overall value of your investment). As part of your investment, we will provide you with fine wine storage in our secure bonded warehouse which is maintained at optimum conditions and fully insured. Storage and insurance are covered in our management fee for the first five years, with a charge per case per year thereafter.
Alternative Investment Opportunities with Long- Term Returns
The best thing about investing in fine wine is the likelihood that it will yield double-digit returns. Since 1988, the average annual returns are 12.4%, consistently outperforming almost every other investment. Indeed, it has been estimated that a £100 investment made in 1952 (around £3K in today’s money) would currently be worth £420,000 – if you’d have invested the same amount in the stock market, today it would be worth just £100,000.
One of the good things about fine wine is that people will always want to drink it – it’s been around for thousands of years after all. Globally, the demand for fine wine around the world is increasing.
It’s Tax- Free!
Investing in fine wine is tax efficient. The current rules around it are based on the assumption that wine is a consumable commodity which will eventually become undrinkable. It is therefore considered to be a ‘Wasting Asset’ by HMRC, and as such, you will not have to pay Capital Gains Tax (CGT) on its sale.
When you buy a bottle of wine from the off- licence or supermarket, you will be paying VAT and Import Duty on it. However, when you buy and sell wine that is held under bond, your wine is exempt from both. The liability falls on the shoulders of the buyer taking it out of bond to sell to consumers.
Liquidating Your Alternative Investment Assets
As you own your wine, you can sell it at any time you like with no fees, and with no CGT to pay. So if you need to sell before you originally planned, it’s easy and won’t be a problem.
If you would like to find out more about investing in fine wines, contact us now.