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If you save or invest money, you'll generally have to pay tax on any interest or income you get, but there are ways of investing that give you a more efficient, or even tax-free, return.
Self-Select ISAs allow you to buy and sell shares without having to pay any further Income Tax liability or Capital Gains Tax (CGT) on any income and/or growth.
The annual allowance for the 2014/15 tax year has been increased to £15,000. Also, the requirement for fixed interest stocks to have a minimum of five years to maturity when purchased within an ISA has been abolished.
The Bespoke Discretionary Service, the Value Investment Portfolio and the Collectives Portfolio services all use ISAs to maximise the tax efficiency of the portfolios through generating potentially tax-free income and sheltering gains from capital gains tax.
Find out more about ISAs »
A Self-Invested Personal Pension (SIPP) allows you to take control over your pension and ultimately the funds you will have available in retirement. In addition to the capital gains, income and inheritance tax benefits offered by all pension arrangements, SIPPs offer three main advantages over a traditional pension: control, flexibility and transparency. Find out more about SIPPs »
The Inheritance Tax (IHT) Portfolio Service is designed to help limit the effect of inheritance tax without limiting access to and ownership of your capital. By taking advantage of Business Property Relief (BPR) on qualifying shares listed on the Alternative Investment Market (AIM) you can claim 100 per cent tax relief once the portfolio has been held for two years. Find out more »
Venture Capital Trusts (VCT) offer income tax relief of 30 per cent when invested at subscription, subject to a maximum investment of £200,000, while minimums are usually around £3,000 - £5,000. Find out more »
Capital Gains Tax (CGT)
Capital Gains Tax (CGT) is payable on the sale or disposal of an asset. The CGT annual allowance for the 2014/15 tax year is £11,000. This will further increase to £11,100 for the 2015/16 tax year. Gains are treated as the 'top slice' of an individual's income and taxed at marginal rates; the rate is 18 per cent up to the higher rate threshold and 28 per cent on amounts above.
Investments and income arising from them can fall in value and you may get back less then you originally invested.
Tax treatment depends on the specific circumstances of each individual and may be subject to change in the future.
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