Investing tax efficiently

The way that investments are taxed has changed over recent years as successive governments have chosen to handle various sources of investment income in different ways. The aim has typically been to increase tax revenues.

Alongside this, the whole tax system has grown increasingly elaborate, thanks to revenue-raising tweaks such as the taxation of child benefit and multiple reforms of dividend taxation. The situation was highlighted in a paper on savings tax from the government’s own Office of Tax Simplification published in May 2018. This noted that, “the interactions between the rates and allowances is sufficiently complex at the margins that HMRC’s self-assessment computer software has sometimes failed to get right”. 

This guide offers a brief outline of how your investments are currently taxed. In the wake of the Covid-19 pandemic, government expenditure has increased dramatically and tax revenue has similarly declined, making it almost certain that taxes will rise at some point to help balance the Treasury books. Expert advice is necessary if you require more information or a greater insight into how to cut your tax bill now. 

Click here to download your copy of Investing tax efficiently.

This publication is for general information only and is not intended to be advice to any specific person. You are recommended to seek competent professional advice before taking or refraining from taking any action on the basis of the contents of this publication. The Financial Conduct Authority (FCA) does not regulate tax advice, so it is outside the investment protection rules of the Financial Services and Markets Act and the Financial Services Compensation Scheme. This publication represents our understanding of law and HM Revenue & Customs as at 8 September 2020.