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Investment Detail


Investment Income

Commercial Property  Income

The vehicle that we use for individuals not using pension money for property, is a Limited Liability Partnership (LLP). Through this route each individual owns a share of the property through the LLP and through a voting system all but minor issues are decided upon through a majority rule. In order to see a stansdard llp agreement please click here.

When we buy a suitable property, we declare a likely income yield that will be payable from your share of the LLP profits. This is made up of the rent received less Lewis' fee and one or two other costs associated with running a commercial property investment.

The prospectus issued will detail the costs (including costs like stamp duty) and work out a sustainable income for the long term, for you as an immediate income investor. Of course one advantage of this type of investment is that you own a share of the property and therefore your income is achieved through a real asset.

So your income is paid to your bank account after costs, each month, however each year you have to pay tax on your share of the profit. The LLP accountants work this out for you and you simply add it to your self assessment tax return each year.

Income returns tend to vary between 5% and 7.5% per annum after costs and before tax and some have fixed uplifts, while others are subject to Market rent reviews. When you eventually decide to sell your holding (if you decide to!) this may be subject to capital gains tax.

Investment Fund Income

The other part of your income portfolio is invested in the selected funds through the supermarket cofunds. Your funds are designed to pay out around 4% - 5% per annum after charges and these can be smoothed by taking a fixed percentage of monthly income to tie in with the levels of dividend payable.

It is our belief that investment funds which pay regular dividends are preferable at this time and will prevail over the longer term. Dividends, as opposed to share prices, are more tangible and consistent, providing a physical return from an investment that may be taken as 'income', or reinvested. Long-term equity returns are influenced heavily by the reinvestment of dividends and dividends can make a significant contribution to total performance when capital returns from equities turn negative.

Equity income funds can provide an attractive investment opportunity as they offer investors the prospect of rising income and capital growth, which is important to protect your income against inflation over the long-term. In addition, over the last few years has seen the global emergence of 'income' yielding stocks that has gradually led to an increase in diversification for investors seeking income and/or capital growth. Diversification can also help to reduce losses in falling market conditions because there is less correlation between asset classes.

We also prefer investment funds which have delivered consistent returns within a given sector and which are managed by strong fund management teams.

As with any investment, past performance is not a guide to future performance and the value of an investment may fall. 

Total Income

Currently an investor with around  £200,000 with lewis would receive an average income of circa £6,000 per year from the LLP's and 5,000 per year from cofunds after charges. This is equivalent to 5.5% per annum, with likely increases and of course, paid monthly.

Please remember that past performance is not a guide to the future. The value of investments, and the income from investments, can go down as well as up and the investor may not get back the full amount invested. This type of investment should always be considered medium to long term of 5 to 15 years’.


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