State Street Global Advisors (SSGA) has launched a £2bn tax transparent authorised contractual scheme (ACS) fund for Scottish Widows.
The ACS is a tax transparent fund that enables pension funds to retain UK tax advantages when dealing in overseas jurisdictions. It offers a regulated UCITS pooled structure, and ensures investors benefit from the same advantageous tax rates they would have received had they invested directly in the underlying securities.
The current fund gives investors passive exposure to North American equities. New strategies will be added in the future to give additional exposures to different geographies or asset classes.
Scottish Widows head of fund development and analysis Iain McGowan says: “We are continually on the lookout for new and innovative structures to suit the needs of our customers. Working with State Street has provided us with the opportunity to provide both a capital and tax efficient vehicle to suit their best interests.”
SSGA European head of defined contribution Nigel Aston says: “As the distribution landscape for UK DC rapidly evolves, we are increasingly being asked by partners, such as life assurance company platforms, to innovate. In a rapidly evolving UK and European distribution landscape, particularly post-Brexit, the tax treatment of an investment ‘wrapper’ is equally important to the actual investment strategy within it. We are finding that being able to build the latest tax transparent vehicles helps us to make our partners more efficient and effective.”