Scottish Widows demutualised in 1999 following the takeover by Lloyds TSB. Instead of issuing cash windfalls they issued Loan notes. This is technically a debt paper that they owe the holder of the note some money.
The idea behind it was that former members would be able to defer the payment of capital gains tax by not actually receiving their windfall until they cash in the loan note.
The latest date for redemption i.e. cashing in notes is the end of March. Some 45,000 former members still hold loan notes that have not been cashed in to the value of £560m.
Widows offer the facility to encash loan notes every six months, so the next window is open. If you wish to encash your notes then you need to act now. If you would like to help on your decision on whether now is the time to encash them or note, please contact us.
If you want to find out more about capital gains tax, please visit the tax pages in Savings Adviser.com .