CT Private Equity Trust : Junior Investment Account (JIA) Key Features

INTRODUCTION

The CT Junior Investment Account (CT JIA) is an Investment Trust Savings Plan that provides a flexible way for you to invest on behalf of children. The CT JIA invests in a range of Investment Funds which are a type of Investment Company.

A CT JIA can play a valuable role in financial planning for your child's future. A CT JIA gives you the opportunity to invest in Investment Funds listed on the stock market with the aim of increasing the value of your investment.

This document contains important information about, and is the contract for, the CT JIA. There are two sections:

n Key Features

• Terms & Conditions (General and CT JIA)

These will help you decide whether investing in a CT JIA is right for you. Read this document carefully to fully understand the investment you are about to make and the terms you are about to agree to.

If you have questions, please call our Investor Services team on 0800 136 420. Lines are open Monday to Friday from 8:30am to 5:30pm. We record and may monitor calls for your protection. You can also email us at invest@columbiathreadneedle.com or visit our website ctinvest.co.uk.

Our Investor Services team cannot give any advice on the suitability of investing in our plans or on how to make investment selections within these plans. If you are in any doubt about your investment choices, you should contact a financial adviser.

As we do not offer advice and provide our services on an "execution only" basis, we are not required to assess the suitability of our plans and the Investment Funds for you. As we have assessed our Investment Funds as non- complex investments, we are not required to consider whether they are appropriate for you. This means you are not protected under FCA rules on assessing suitability or appropriateness.

Terms that are capitalised in this document are defined terms. You can find the definitions in the Terms and Conditions.

US/Canadian investors

We are not able to accept applications for a CT JIA from investors located in the US or Canada. If you move to the US or Canada after opening your plan, restrictions may apply.

SECTION 01

KEY FEATURES

n The CT JIA offers an easy, flexible way to invest, on behalf of a child, in the shares of the Investment Funds Columbia Threadneedle Investments offers

n The Columbia Threadneedle Investments range of Investment Funds aims to provide investors with income, capital growth, or a combination of both

Please read the latest Key Information Document ("KID") for the Investment Funds and Pre-Sales Cost & Charges Disclosures for the plan before deciding to invest; these can be found at ctinvest.co.uk/documents. Please contact us if you wish to receive the regulatory disclosures in paper form. To view daily updated share prices and performance information on our Investment Funds, visit our website ctinvest.co.uk. You can also look at monthly factsheets and the latest Report and Accounts for each Investment Trust.

YOUR INVESTMENT

Through a CT JIA you can invest in as few or as many Investment Funds offered as you choose.

You can buy and sell shares in the CT JIA on any Business Day. Postal requests we receive by 5pm (online requests by 11:59pm) will normally be carried out on the next business day.

You can start, stop, or change your monthly contributions or make a lump sum contribution.

We can accept payments from third parties, for example grandparents, directly into the plan, subject to the completion of a JIA top-up form (available on our website ctinvest.co.uk or by calling us) and through the necessary identity and address checks as specified in 'How do I apply'.

You should view your investment as long term, but you may close your plan and sell your shares at any time. Any sale of shares may result in a capital gains tax liability, if you are in any doubt, you should seek advice.

THE AIMS OF OUR PLANS AND THE INVESTMENT OPTIONS

We offer a range of Investment Funds, which aim to provide income, capital growth, or a combination of both.

To view daily updated performance information, please visit our website: ctinvest.co.uk. There are also factsheets to download and copies of the latest set of Report and Accounts.

Risk

Our Investment Funds invest in the stock market. Some of them also invest in unlisted companies, other investment funds, and property. It's important that you understand there are risks as well as potential rewards before you decide to invest.

General risks

Gearing - Investment Trusts can borrow money to make additional investments. This is known as "gearing" and is intended to boost your return on investment. However, it can also increase risk. Gearing tends to have a positive effect on the value of the trusts in a rising market, and an unfavourable effect in a falling market.

Charges taken from capital - Certain Investment Funds prioritise generating income over capital growth. These Funds may deduct part or all of their management charge from capital. This increases the amount of income available at the expense of capital growth.

Investment Funds may also deduct charges and expenses from capital, if the trust has not earned enough income to cover these charges and expenses. This will reduce capital and limit its growth.

Liquidity - Investment Funds may invest in smaller companies. Shares in smaller companies are generally traded less frequently than those in larger companies. This means both buying and selling shares in smaller companies may be difficult, and individual share prices may be subject to short-term price swings.

Premiums and discounts - As Investment Trust shares are publicly traded on the London Stock Exchange, their price is determined by market factors, such as demand and supply between buyers and sellers. The price will not necessarily accurately reflect the underlying value of the trust's portfolio of investments (its "net asset value" or NAV).

The share price of an Investment Trust may be either higher than the NAV - in other words, they are traded at a premium, or lower than the NAV - in other words, they are traded at a discount. Discounts and premiums vary constantly. Buying shares at a discount could be seen as value for money, but there is no guarantee the discount will narrow and there is a risk that it may widen further. Many factors influence the discount or premium, and a large discount does not necessarily indicate a bargain.

Price volatility - The value of shares of an Investment Trust and the income from them is not guaranteed; the value can fall and rise due to stock market and currency movement. Past performance is not a guide to future performance. When you sell your shares, you may get back less than you originally paid for them. In certain circumstances, for example extreme market volatility, the shares of an Investment Trust could be suspended from trading on the London Stock Exchange. You would not be able to purchase or sell these shares until the suspension is lifted.

Underlying investment exposures - In addition to these general risks, the shares of a particular Investment Trust are exposed to the investment risks associated with the assets it holds in its portfolio. The specific investment risks for each Investment Trust are described in their KID, which you should read prior to deciding to invest.

Other Important Points

Investment needs - If you open a CT JIA to fund a specific need, for example to pay university costs, you may not achieve your goal if you do not maintain your contributions or if your investment does not grow sufficiently.

Changing your mind - If you open a CT JIA and then decide to exercise your right to cancel it within the 14-day cancellation period, you may not get back the amount you invested. This is because the value of your investment may have fallen between the day your money was invested and the date we sell the shares after we get your cancellation notice. Dealing charges and stamp duty paid are not refunded.

YOUR QUESTIONS ANSWERED

What is an investment trust?

The Investment Trusts we describe in this document are investment companies listed on the London Stock Exchange. Investment Trusts own a portfolio of investments that are managed by professional managers. Owning shares of an Investment Trust allows you to spread your investment risk across a number of investments and potentially benefit from the expertise of professional fund managers.

The Investment Trusts available to CT JIA holders include UK-authorised Investment Trusts and overseas closed- ended investment companies, but all are listed on the London Stock Exchange.

What is the CT JIA?

The CT JIA is a Columbia Threadneedle Investments Savings Plan designed to facilitate saving and investing for children in Investment Funds managed by Columbia Threadneedle Investments. The account can be used to invest a child's own money including periodic and regular gifts to the child from the account holder or third parties.

What options do I have?

You can set up the account depending on your own needs. You can set it up:

1. so that the child is the beneficial owner of the account
2. so that you retain ownership of the account

The different tax treatment of these options is outlined on page 5 of this document. You are required to confirm whether the assets are held for you or in trust for another person when you sign the application form. Columbia Threadneedle Investments will only accept instructions from the registered holder(s).

We've explained more about these options below. If you remain unsure about which option is right for you or how to register any resulting trust, we'd recommend that you seek independent advice.

Making the child the beneficial owner

Children under 18 may not be the registered holder of shares but can be recorded as the beneficial owner of the account. The account is set up with adults as registered holders who operate the account on behalf of the child normally reflecting the child's name or initials.

Columbia Threadneedle Investments will accept instructions from the registered holder only and will pay proceeds or transfer investments from the account on the instruction of the registered holders.

The person providing the initial investment or from whose bank account the regular collection is made (the donor) can choose whether or not to be a registered holder. The donor has no control over the investment, unless they are also one of the registered holders who have control over it until the child reaches the age of legal capacity.

On reaching the age of legal capacity, the child can demand that the fund is transferred into their name or paid out to them. These instructions can be given by completing either a 'Transfer of ownership form' to transfer into the child's name or a 'Sale of shares' form to instruct the account

be closed and the proceeds paid out in the names of the registered holders. Both forms are available on ctinvest. co.uk/documents or can be posted on request. The instruction to Columbia Threadneedle Investments must come from the registered holders.

Under Scots law the child is entitled to the assets from 16 but they are not allowed to hold shares until they are 18. If the assets are being given to the child at 16 this must be done by the shares being sold and the proceeds being paid out. Alternatively the registered holders can continue to control the account until the child reaches 18.

Registering a Trust

Where an account is set up for the benefit of a child, this establishes a bare trust. The trustees should register the details of the trustee, donor and beneficial owner on the HMRC Trust Registration Service within 90 days of making the payment.

This needs to be completed separately to your application.

Retaining ownership of the account

The CT JIA can also be used to invest funds intended to be used for the benefit of one or more children but where ownership of the funds is retained by the account holder.

A designation can be used to identify funds that you have set aside for a particular purpose. When you use a designation please ensure you retain a record of your intentions for the account.

Who can open a CT JIA?

You can apply if you are 18 or over and are investing on behalf of someone under 18. You can apply individually or jointly with others.

Are there contribution limits?

There is no limit to the amount you can invest in the CT JIA.

How do I apply for a CT JIA?

To apply for a CT JIA, complete an application form. If you intend the investment to be viewed as being held in trust, you should complete the application form in the name of the registered holders and denote the child as the beneficial owner. You can return applications, on the appropriate application form (also available on our website), in the envelope we provide or to Columbia Threadneedle Management Limited, PO Box 11114, Chelmsford, CM99 2DG. A separate application form should be completed for each designation required.

You can make lump sum contributions to a CT JIA by post with a cheque payable to "Columbia Threadneedle Management Limited" or online using a debit card.

Cheques should be drawn on your own, sterling denominated UK bank account. Third party cheques may be acceptable but also we need the full name and address of the payer in order to meet our requirements under the Money Laundering Regulations. The application form allows you to provide this information.

If cheques have not been drawn from a personal chequebook (i.e. a bank or building society draft) please ensure that your bank/building society have endorsed the reverse. This means that the bank/building society stamp the back of the cheque and confirm the name of the account that the cheque was drawn from. The person adding this endorsement should also sign the reverse of the cheque and note their role/title, once they have added this information for reference.

A cheque drawn on a solicitor's or accountant's client account must be accompanied by confirmation from the solicitor or accountant that the funds belong to you.

For monthly savings, please provide proof of your bank/ building society details with the application form. We can accept a pre-printedpay-in slip or a cancelled cheque.

Please note that we will not be able to set-up the Direct Debit until bank verification has been provided.

You can also make monthly contributions by Direct Debit either online or by completing and returning the Direct Debit instruction on the application form. We collect Direct Debits from your bank account on or around the 1st of each month.

What confirmation will I receive?

Within five days of receiving your application to open a CT JIA, we send you a Welcome Pack confirming we have set up your account. You also receive information on your right to change your mind.

How much can I invest?

There is no limit to the amount you can invest in the CT JIA.

Will I have access to the money in the CT JIA?

Yes, you can make withdrawals in cash by giving notice in writing. If the plan is set up under trust it is the responsibility of the registered holders to ensure that the money is used for the benefit of the child.

Is there any tax payable on the CT JIA?

Authorised Investment Funds are exempt from tax on capital gains realised within their investment portfolios but pay corporation tax on the excess of total income received from foreign companies, fixed interest securities and deposit interest over the total of the management expenses and any loan interest that has been paid.

Overseas investment companies are subject to local taxes and will be subject to UK tax in respect of trading activities (if any) conducted in the UK. Overseas property companies are subject to the UK Non-Resident Landlord scheme in respect of rental income from UK properties. Investment companies registered in Guernsey are not expected to have a significant exposure in respect of Guernsey tax.

Certain charges that are levied may be subject to VAT and other statutory duties.

These accounts are intended for UK investors, though we may accept at our sole discretion applications from non- UK investors. We will therefore apply VAT as standard to all charges payable by investors irrespective of residency. We regret that we are unable to vary this for non-UK investors. However we may be able to refund you the VAT paid as standard depending on your tax residency. Please contact us if you wish to discuss this further. You should contact your tax adviser for advice on your individual circumstances.

Tax implications for the accountholder depend on who the registered holder is and whether there is a beneficial owner. Tax rates and reliefs are subject to change, however the broad rules that apply, based on our current understanding of law and practice, appear below. You should consult your tax adviser on the tax consequences of investment, based on your own personal circumstances.

What is the tax status of the CT JIA?

Unlike a Child Trust Fund (CTF) or Junior ISA (JISA), there are no tax benefits attaching to the JIA. However there are not the restrictions on subscriptions to or withdrawals from the account (there are no restrictions other than any minimum investment amounts) that you would have on a CTF or Junior ISA.