Alternative Investment Market (Aim) shares can now be held in a stocks and shares Isa.
A key benefit of this is that many Aim shares are eligible for a form of tax relief called Business Property Relief (BPR), which means they become exempt from inheritance tax after two years.
Stocks and shares ISAs are normally subject to inheritance tax, meaning older investors who have built up significant Isa portfolios over the years have faced a dilemma - enjoy the tax benefits now (by keeping their money in the wrapper) or give their families tax benefits later (by selling out of the Isas, in order to gift the money or put it into trust).
Richard Power, head of the smaller companies team at Octopus Investments, said: "Transferring Isa savings into an Aim-focused Isa that's built around BPR genuinely appears to offer the best of both worlds - tax-efficient growth for as long as possible, followed by significant tax savings when the investor passes away. There's even the scope to pass the portfolio on to the beneficiaries, so it's truly a long-term investment plan."
However, investing in Aim can be risky. In the year to 9 July, the FTSE Aim All-Share index fell by 6.5%, while over five years it was down 22%, as pointed out by Moneywise contributor Andrew Pitts in his August column.