Now you can pop Aim shares into your Isa too

Last August, the government finally removed the frustrating and illogical restriction that prevented Aim (Alternative Investment Market) stocks from being held in an Isa. This has made stocks on the UK’s smaller companies board especially attractive from a tax perspective. In addition to now receiving tax relief on dividends and capital gains when held in an Isa, many continue to be exempt from inheritance tax under the Business Property Relief rules. What’s more, Aim stocks will be exempt from stamp duty with effect from April 2014.

Those who prefer more stable, established companies may conclude that this won’t benefit them. But that’s not necessarily the case. While Aim is mainly for smaller, riskier companies, there are also a number of established firms that have never made the jump to the main board. Online retailer ASOS (Aim: ASC) has long been the most famous example – it’s large enough to make it into the FTSE 100 had its Aim status not ruled this out. Perhaps the most interesting for conservative investors are a number of stable, cash-generative, dividend-paying businesses, many of which are family-controlled and are on Aim to take advantage of less stringent rules on free float.

Popular choices include flooring specialist James Halstead (Aim: JHD), retailer Majestic Wines (Aim: MJW), soft drinks maker Nichols (Aim: NICL) and pub chain Young’s (Aim: YNGA (ordinary) and Aim: YNGN (non-voting)).

See also:

• Isas make sense – so act quickly
• Cash Isas: Get a better rate on your savings
• Funds Isas: How to pick the best platform for you
• Stocks & shares Isas: It pays to compare brokers
• Adventurous investing: Spice up your Isa with exotic investments
• Sipps: Take control of your pension

See our full Isa coverage here

66% off newsstand price

12 issues (and much more) for just £12

That’s right. We’ll give you 12 issues of MoneyWeek magazine, complete access to our exclusive web articles, our latest wealth building reports and videos as well as our subscriber-only email… for just £12.

That’s just £1 per week for Britain’s best-selling financial magazine.

Click here to take advantage of our offer

Britain is leaving the European Union. Donald Trump is reducing America’s role in global markets. Both will have profound consequences for you as an investor.

MoneyWeek analyses the critical issues facing British investors on a weekly basis. And, unlike other publications, we provide you with the solutions to help you turn a situation to your financial advantage.

Take up our offer today, and we’ll send you three of our most important investment reports:

All three of these reports are yours when you take up our 12 issues for £12 offer today.

MoneyWeek has been advising private British investors on what to do with their money since 2000. Our calls over that period have enabled our readers to both make and save a great deal of money – hence our position as the UK’s most-trusted investment publication.

Click here to subscribe for just £12