The Inland Revenue are apparently keeping a close eye on the investments held within PEPs. Under PEP rules, you are allowed to hold the money invested in cash but only as long as you intend to invest it in equities later on. In simple terms, holding cash should just be a stop gap. To stop the losses associated with equity investing, some investors have moved out of equities and into cash. If this is deliberate and you have no intention of investing back into equities, the Inland Revenue could withdraw the tax privileges, so beware.PEPs ceased to be available in 1999 although existing ones were allowed to continue.
Everyone should review their PEPs in case of under performance or excessive charges as they can still be transferred to other PEPs without losing any of the tax benefits.
For a free review of your PEP, download this authority form. Just complete the form and return it to us and we will give you an idea of performance against other similar funds. If you decide you want to transfer we can either act on your instructions or advise you where to transfer. Simple as that.
Learn more about PEPs and other tax efficient savings.
Learn about savings in general in the Savings Adviser.com.