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Early Leavers.
Generally refers to occupational pension scheme members who leave
the scheme before normal retirement age.
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Earnings Cap. See
'Cap'.
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Earnings Per Share.
A ratio calculated as share earnings for the year divided by number
of shares in issue
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Earnings Yield.
A company’s earnings available for shareholders dividend by the
current market value of the company’s equity capital, or earnings
per share dividend by the share price.
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Easement. Rights
of a landowner exercised over neighbouring land e.g. a right of
way.
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Econometrics. Mathematical
methods used in analysing economic models or problems.
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Economic. Whether
something can be produced profitably.
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Economics. The
study of an economy (business, or country or trade grouping) and
its related financial structures and procedures.
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Effectiveness.
A measure of achievement in respect of a specific objective.
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Efficiency. A measure
of output compared to input.
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Eiusdem Generis Rule.
One of the principle rules of interpretation of statutes, meaning
‘of the same kind’. It is taken to mean that where general words
follow specific words, those general words are interpreted in
the light of the specific words - For example, in the phrase ‘cats,
dogs and other animals’, ‘other animals’ will be interpreted by
the court as referring to other domestic animals.
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Election. An unequivocal
choice.
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Electro-Cardiogram.
A device to measure the activity of the heart.
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Eligibility. Most
occupational pension schemes have age and service qualifications
that must be met before an individual is able to join the scheme.
Such qualifications may be termed eligibility conditions.
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Embargo. Instruction
which stops or delays something happening - usually relates to
a trading situation, but may also relate to release of information
e.g. company announcement.
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Embezzlement. A
form of theft; the misappropriation of an employers funds by an
employee.
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Emoluments. Used
as a term for the total earnings package when calculating the
potential benefits from an occupational pension scheme, and calculating
maximum approvable benefit limits.
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Employee. Someone
who works under the control and direction of another in return
for wages/salary.
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Employee Profit Sharing Scheme.
A type of share incentive scheme whereby a special trust is established
to purchase company shares which, provided certain conditions
are met, will escape income tax on profits on resale.
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Employee Share Incentive Schemes.
Arrangements which enable employees to purchase the shares of
their employing company, some with tax advantages, some without.
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Employee Share
Ownership Plans. Share incentive schemes which
allow the employing company to make tax deductible contributions
into an Employee Share Ownership Trust. Trustees then use the
money to buy company shares for all participating employees, who
qualify by reference to working hours and length of time employed
by the company.
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Employer. Someone
who controls and directs the work of another, an employee, in
a master/servant sense, and who pays that person a wage or salary
for work done.
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Endorse.
-
Signature on a document e.g. cheque, to show that ownership
has passed, or e.g. a bill, to show that goods have been received.
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Add additional information to an insurance policy to amend
the existing wording.
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Endowment Assurance.
A medium to long term life assurance/savings contract, incorporating
an investment element and a protection element. Policy proceeds
normally paid on maturity or earlier death. After early years
policy acquires surrender value. See ‘Maximum
Investment Plan’.
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Endowment Mortgage.
An interest only property purchase loan where the outstanding
capital will be repaid at the end of the term out of the fund
accumulated under an endowment policy.
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Engrossment. Preparation
of a legal document in its final form prior to signing.
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Enterprise Investment
Scheme. Introduced by the November 1993 budget
as a replacement for the BES scheme which ended 31/12/93. Investors
can invest up to £100,000 each year and get 20% tax relief; an
additional 20% is available if the venture fails.
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Enterprise Zone Trusts.
Property trusts investing in enterprise zones, or areas in which
businesses receive special government incentives for a fixed period.
Investors in these trusts can write off most of their investment
against income tax liabilities.
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Enterprise Zones.
Designated areas throughout the country offering special tax incentives
to encourage investment in commercial property.
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Equal Access. The
equal access provisions of legislation relating to occupational
pension scheme membership make it obligatory to offer the same
eligibility conditions to men and women doing the same type of
job.
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Equalisation of Estates.
When a husband and wife divide their assets so that they save
the maximum amount of tax.
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Equities. Common
alternative term for ordinary shares.
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Equity. The value
of a business (assets less liabilities, but excluding ordinary
share capital) or of a property less the amount of the mortgage.
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Equity of Redemption.
The rights of the mortgagor, i.e. the property owner, over the
mortgaged property. i.e. the right to redeem the property.
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Equivalent Pension Benefit.
A flat rate state pension benefit paid to employees who contracted
out of the graduated pension scheme that was in force before the
current SERPs. (Sometimes referred to as the Boyd - Carpenter
scheme).
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Escalation. A term
used to describe contracted increases in pensions in payment,
or in regular contributions.
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Escrow. A deed
which has been delivered, but which will not become operative
until a later date or until certain conditions have been met.
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Estate. More properly
used in connection with ownership of land. Generally used in a
wider context, however, relating to one’s personal possessions.
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Estate Duty. A
tax payable on an estate at death between 1894 and 1975.
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Estate Planning.
General phrase relating to personal financial planning, the emphasis
being on passing on intact as much of one's estate on death with
as little tax as possible being paid.
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Estate Protection.
Generally a mix of asset reorganisation and use of packaged life
products to reduce tax liability and to pay any tax that does
become due.
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Ethical Investment.
Making investments only in companies which are considered acceptable
according to a set of criteria concerning the type of product,
environmental issues and political issues..
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Eurobond. A medium/long-term
bearer bond denominated in a European currency and issued by Government
or international companies.
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European Currency
Unit. Based on a basket of weighted currencies
of EU members.
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European Monetary
System. Means of stabilising exchange rates among
members of European Union. See Snake and ERM..
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European Monetary
Union. Expressed aim of EU.
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Ex gratia. A payment
made without obligation
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Ex Officio. Latin,
‘by virtue of holding an office’ i.e. being in one job will involve
taking on other jobs.
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Excess Clause.
A clause in an insurance policy requiring the policyholder, in
the event of a claim, to bear part of the claim.
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Exchange Rate.
The value of a country’s money compared with other currencies.
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Exchange Rate
Mechanism. (ERM) An underlying element of the European
Monetary System which enables EU countries to keep currencies
within a fixed percentage of each other, prior to the introduction
of the Single Currency
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Excise. A tax on
certain goods produced within national boundaries, as opposed
to ‘duty’, which is generally a tax on imported goods.
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Execution only.
Where an adviser is instructed by a client to arrange a particular
investment, without having received advice from the adviser.
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Executive Pension
Plan. An occupational pension arrangement governed
by occupational pension rules, not Personal Pension rules. Open
to employees only. Used by employers with few employees, and to
provide discretionary benefits.
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Executor. Someone
(individual or professional firm) that ensures that the terms
of a will are carried out.
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Exemplary Damages.
Damages awarded to punish the defendant, rather than compensate
the plaintiff.
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Exempt
Approval. The usual route to achieve Revenue approval
for a group occupational pension scheme. The main difference between
this type of approval and Discretionary approval is the establishment
of a trust.
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Exempt Approved Scheme.
An occupational pension scheme, established by irrevocable trust
or statute, which has been approved by the Pension Schemes Office
of the Inland Revenue under the Income and Corporation Taxes Act
1988, s592.
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Exempt Income.
Investment income which escapes tax, such as National Savings
Certificate.
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Exempt Unauthorised Unit Trusts.
Whilst most unit trusts are authorised, authorisation places limitations
on the types of investments permitted. Some funds do not seek
authorisation, to escape these restrictions.
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Expatriate. Someone
who works away from their own country.
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Experienced Investor.
One of the categories of investor under the Financial Services
regulations; one who regularly invests in their own right and
should, therefore, have a clear understanding of the risks and
rewards involved.
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Expression of Wish.
Term generally used in relation to the payment of benefit from
a group life assurance scheme, whereby to maintain the tax-free
status of payments from the scheme, the Trustees have complete
discretion on how to pay out the benefit. Scheme members cannot
direct the Trustees, therefore, so must limit their ’instructions’
to an informal, non-binding expression of wish. Also known as
a Nomination form.
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Extra Statutory
Concessions. Concessions granted by Inland Revenue
to permit actions not normally allowed or to reduce or eliminate
tax which would otherwise be payable e.g. Extra Statutory Concession
A9 allows GPs to be in NHS Scheme and contribute to personal pension
at same time.
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