Don't invest unless you’re prepared to lose all the money you invest. This is a high-risk investment and you are unlikely to be protected if something goes wrong. Take 2 mins to learn more.
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Due to the potential for losses, the Financial Conduct Authority (FCA) considers this investment to be high risk.
What are the key risks?
- You could lose all the money you invest
- If the business you invest in fails, you are likely to lose 100% of the money you invested. Most start-up businesses fail.
- You are unlikely to be protected if something goes wrong
- Protection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
- Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA-regulated firm, FOS may be able to consider it. Learn more about FOS protection here.
- You won’t get your money back quickly
- Even if the business you invest in is successful, it may take several years to get your money back. You are unlikely to be able to sell your investment early.
- The most likely way to get your money back is if the business is bought by another business or lists its shares on an exchange such as the London Stock Exchange. These events are not common.
- If you are investing in a start-up business, you should not expect to get your money back through dividends. Start-up businesses rarely pay these.
- Don’t put all your eggs in one basket
- Putting all your money into a single business or type of investment for example, is risky. Spreading your money across different investments makes you less dependent on any one to do well.
- A good rule of thumb is not to invest more than 10% of your money in high-risk investments.
- The value of your investment can be reduced
- The percentage of the business that you own will decrease if the business issues more shares. This could mean that the value of your investment reduces, depending on how much the business grows. Most start-up businesses issue multiple rounds of shares.
- These new shares could have additional rights that your shares don’t have, such as the right to receive a fixed dividend, which could further reduce your chances of getting a return on your investment.
If you are interested in learning more about how to protect yourself, visit the FCA’s website here.
Inheritance Tax Portfolios
Retain control of your wealth and protect it from inheritance tax
Inheritance tax (IHT) could apply to estates over the value of £500,000. This is made up of the “residence nil rate band” of £175,000 plus the current “nil rate band” of £325,000 – both of these are now frozen until 2030. Anything over this could potentially be subject to 40% tax on death, or your spouse’s or partner’s death if later (read more on IHT rules).
For those prepared to take greater investment risk, one way to shelter your wealth from IHT is to invest in unquoted IHT portfolios.
They are discretionary portfolios of unquoted companies that should qualify for BPR. Technically, you invest in one or more companies (usually run by a specialist investment manager) which in turn own and operate several companies or projects. The managers typically aim to give investors exposure to assets they believe can deliver some growth (above inflation) with low volatility – not guaranteed.
The investment should qualify for IHT relief if you hold it for two years and on death, provided it remains qualifying.
From 6 April 2026, 100% IHT relief will be capped at the first £1 million of assets (including private companies and agricultural property). The excess will still benefit from IHT relief but at a reduced rate of 50%, an effective IHT rate of 20%.
Important: The information on this website is for experienced investors. It is not a personal recommendation to invest. If you’re unsure, please seek advice. Investments are for the long term. They are high risk and illiquid and can fall as well as rise in value: you could lose all the money you invest. Tax rules can change and benefits depend on circumstances.
| Portfolio name | Sector | Target return | Portfolio size | Initial charge | Minimum investment | Invest now |
|---|---|---|---|---|---|---|
Downing Estate Planning ServiceChoice of focus on renewable energy or asset-backed sectors, with optional insurance Find out more |
Property & renewables
|
3-4.5% p.a.
|
£964.0 million
|
4.0%
|
£25,000
|
|
Free guides & factsheets
Knowledge bank
Want to learn more about IHT investments? Wondering how forestry funds work? Interested in ways to make more of your ISA and SIPP? Our free guides and resources explain briefly and in plain English the benefits and risks of investment opportunities for experienced investors.
