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Tax efficiency

The TM Hearthstone UK Residential Property Fund is constructed as a UK domiciled Open Ended Investment Company (OEIC) with Property Authorised Investment Fund (PAIF) tax status. As a PAIF, all of the Fund’s income from property investment is exempt from corporation tax, which would normally be payable by an OEIC at 20%.

As a result, the PAIF is very efficient for tax purposes, and the investor is taxed upon the PAIF assets more or less as if they held those assets directly. This is particularly relevant for those investors holding the Fund within tax advantage wrappers such as SIPP, ISA or Offshore Bond.

A feeder fund option is also available which is structured as a UK Authorised Unit Trust. Whilst this can also be held within SIPP, ISA and Offshore Bond, it does not offer the same corporation tax exemption enjoyed by PAIFs. The feeder fund structure is used by some of the online fund supermarkets an investment platforms which cannot currently administer PAIFs.


Information above is based on Hearthstone’s understanding of legislation in force as at January 2015. Legislation may change, and tax and trust law may be open to differing interpretation.

The impact of taxation will depend on individual circumstances.

Hearthstone strongly recommends that potential investors seek advice from their financial adviser or tax specialist before using the TM Hearthstone UK Residential Property Fund within any of the tax planning ideas set out on this website.

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Hearthstone Investments PLC is the parent company of the Hearthstone Group. Regulated activities associated with the TM Hearthstone ICVC are carried out by Hearthstone Asset Management Limited, which is an authorised representative of Thesis Asset Management Limited, authorised and regulated by the Financial Conduct Authority (114354). Other companies in the group provide investment advisory and other services funds aimed at professional clients. Details of these companies are provided in the investment materials associated with each fund.

Information in this website is presented for information purposes only. No information in this website should be treated as an invitation or inducement to invest in any particular investment product over another, nor as investment advice. If you are in doubt about whether a particular investment product described within this site suits your needs you should consult your Independent Financial Adviser. Neither Hearthstone Asset Management Limited or Thesis Asset Management Limited accept any responsibility for your use of this site other than in accordance with these terms.

Please note that future predictions/outlook observations are Hearthstone’s own views and do not guarantee they will come to fruition. Please also note past performance is not a guide to the future. 

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