Immediate Life Annuity

Easy to buy

• Your clients can buy this annuity with funds from savings, inheritance, or tax-free cash from a maturing pension scheme.

 

Great choice

• Income can be monthly, quarterly, half-yearly or annually
• Income can be fixed or increase each year by a set percentage
• Option to guarantee that when your client dies their estate will receive the value of the money put into the annuity, less any payments that have been made

 

Good value

• The plan may qualify as a purchased life annuity with associated tax benefits
• Clients can guarantee income payments for a fixed period from the outset, so payments are made even if they die in that time
• Option of paying income to a dependant when your client dies

Age limits

If the annuity is set up to cover 2 people, both applicants need to be 55 or over and at least one of them must be under 95.

 

Term

Income is paid for as long as your client lives - and if a dependant’s option is chosen, to that person for as long as they live. 

 

Payment limits

If the plan is being bought from your client’s own funds, the minimum payment is £7,500 after adviser charges. If it’s being purchased by trustees of a will or settlement, the minimum figure is £100,000 after adviser charges. If your client wishes to purchase a plan with a value of £2 million or more after adviser charges, please contact us directly. 

 

Product charges

There are no extra product charges. All the charges for setting up and running this annuity are taken from the fund and accounted for when we set the income level. If we're required to rewrite the policy after set up, we may apply a £40 charge each time this is done, depending on the circumstances.

 

Adviser charges

We’re happy to facilitate an adviser charge. It can be a fixed amount or a percentage of the annuity-purchase amount, with the option to specify a minimum and/or maximum (only available on advised cases). 

 

Commission

For non-advised sales commission is available and rebating is allowed. For any commission enquires please contact acinfo@aviva.com

 

Tax

Our Immediate Life Annuity may be taxed differently from pension annuities. HM Revenue and Customs may decide that part of your client’s payment is a return of capital and not subject to tax. 

Our Immediate Life Annuity is designed for clients who:

• Are typically aged between 55 and 95
• Want a regular income for life
• Are looking for a product that has no investment risk attached
• Have an amount to invest of at least £7,500 after adviser charges

It’s unlikely to be suitable for:

• Clients who want flexibility in their future income
• Clients who would like the opportunity to change their product in the future

Things to consider:

• Are there tax considerations you should discuss?
• How old are your clients and what is their life expectancy?
• Do your clients realise they can't cash this plan in at any time?

Possible alternatives to the Immediate Life Annuity include:

• Investment bonds
• ISAs
• Other forms of non-pension savings and investments