Interesting. Not sure about the year 5 to year 8 bit. But in essence this rule of thumb is driven by the fact that Exit Losses are worthless. Thus if you are in a loss position, you are crystalising a worthless loss. But if you are in a gain position and cash and reinvest, then any subsequent losses will be worthless whereas they would have sheltered the gain you triggered.To the best of my knowledge, the only time that it makes sense to cancel one unit-linked investment to avail of a lower priced product is when it's between year 5 and year 8 and it's at breakeven.
Reducing the AMC from 100bps to 65bps is hardly changing the structure. But I accept your knowledge that this is how companies would process it. There is no Revenue reason why it cannot be accommodated within the same policy.You can transfer/switch from one intermediary to another without cashing in an investment but if you want to change the structure of the pricing then it's a 'new' investment and you trigger a deemed disposal.
Neither can I, but this phenomenon that the AMC on the exact same fund can vary with the broker is fairly new.I can't remember when it was any different,
Only if you can get a 101% allocation rate on reinvestment to offset the 1% levy on reinvestment?At the point when your investment is break-even. It may make sense to try and trigger the DD event, to reset the clock, so your funds have full 8 years to grow again before the next event.
Very clever.At the point when your investment is break-even. It may make sense to try and trigger the DD event, to reset the clock, so your funds have full 8 years to grow again before the next event.