Each UK individual is entitled to a £6,000 Capital Gains allowance (2023/2024 tax year), which can be used to soak up most investments that make a ‘gain’, including investment property, Shares and Gilts.

This type of account is used to absorb a person’s annual Capital Gains allowance, essentially meaning that the first £6,000 (for an individual) of capital gain in the portfolio would be free of Capital Gains Tax, once the funds are sold and the gain crystalised. We can manage your funds to trigger this.

As well as Capital Gain, growth is also made up by income from Dividends, allowing for the utilisation of Dividend Income Allowance (currently £1,000 per annum for the tax year 2023/2024)

Of course, we would only use the Capital Gains Tax allowance if it was not being taken up by the client elsewhere within their overall asset base.

A Lifetime ISA (LISA) is a tax-efficient savings or investment account. You can use one to save and invest for your first home or later life. Like other types of ISA, any money held within the Lifetime ISA will not be subject to UK income or capital gains tax.You can contribute up to £4,000 each tax year into the Lifetime ISA and the government will add a further 25%. So for every £4 you save, you get £1 extra - up to £1,000 per tax year. Tax rules can change and their benefits depend on your circumstances. 

Lifetime ISA allowance forms part of the overall £20,000 annual allowance. You need to be between 18 and 39 to open a Lifetime ISA. But you can still pay in – and get the government bonus – until you turn 50. You can put up to £4,000 into a LISA per tax year so you can get a bonus of up to £1,000 per tax year. Assuming the allowance and bonus stayed the same, this means you could get £8,000 free from the government if you paid in the full amount for 8 years.

If using the LISA to purchase a property, you need to be a first-time buyer and it must have been 12 months since the first payment into the Lifetime ISA before you can use the money to buy a home without facing a withdrawal penalty. The property must be in the UK with a purchase price of £450,000 or less. It will need to be your main home or become your main home as soon as it’s ready if it’s still being built.

If you are happy to take on significant investment risk, the benefits of an AIM ISA can be rewarding. You can enjoy tax-free income and growth for the entirety of your life which is a major advantage. By investing in shares within the AIM ISA, which invests in BPR-qualifying companies, you can pass on more of your wealth free of Inheritance Tax (IHT). This is because such investments can benefit from 100% relief from IHT. In the 2022 to 2023 tax year (6 April to 5 April) there’s a limited amount of money you can put in your child's Junior ISA. This tax year the Junior ISA allowance is £9,000.Tax rules for ISAs can change and their benefits depend on individual circumstances.

Offshore Bonds are a tax-efficient way for you to invest money over the medium to long term. This is usually over five years or more.
With an Offshore Bond, you can invest a lump sum or regular payments. Investing your money means it could potentially grow tax efficiently over time because you won't normally pay tax on investment growth, which could give you more savings for the future.

When you feel ready, the money you've saved can be taken as a regular income to pay for life in retirement. Each year you can withdraw up to 5% of the total payments made into the bond on a tax-deferred basis. This is cumulative so if you don't take a withdrawal in year one, you can take 10% in year two. Or you can choose to pass it on to your family. An Offshore Bond can be fully or partially surrendered at any time.

Offshore investing can be a tax-efficient way to plan for your future, as you normally won’t pay any tax until you take more than your tax-deferred allowance for the year out of the bond. The amount of tax you’ll have to pay will be based on your situation at that time.
Offshore bonds can be useful if:

• You’re looking for a tax-efficient way to save for the future
• You’ve used up your pension allowance, as a bond can offer tax advantages
• You’re thinking about protecting your estate against inheritance tax
• You’re planning to gift money to your family or friends.

UK Investment Bonds are non-income producing investments and so have a different tax treatment from other UK based investments. This can provide valuable tax planning opportunities for individuals. The funds underlying the bond are subject to UK life fund taxation meaning that you're treated as having paid Income Tax at the basic rate on the amount of your gain. This notional tax is not repayable in any circumstances. You will have no liability to Capital Gains Tax or basic rate Income Tax on bond gains. 

Certain events, also known as chargeable events, that can occur during the lifetime of your onshore investment bond may trigger a potential Income Tax liability:

• Death giving rise to benefits.
• Transfers of legal ownership of part or all of the bond (though not gifts).
• On the maturity of the bond (only applies to Capital Redemption bonds).
• You cash in all your bond or individual policies within it.

You can withdraw up to 5% each year of the amount you have paid into your bond without paying any immediate tax on it. As you're treated as having paid basic rate tax on the amount of the gain, the maximum rate you would be liable for is the difference between the basic rate and your highest rate of income tax for the relevant tax year. 

The gains may also affect your eligibility for certain tax credits and you could lose some or all of your entitlement to personal allowances. If you're a higher or additional rate taxpayer now but know that you will become a basic rate taxpayer later (perhaps when you retire for example) then you might consider deferring any withdrawals from the bond (in excess of the accumulated 5% allowances) until that time. If you do this, you may not need to pay tax on any gains from your bond.

Venture Capital Trusts (VCT) invest in small or early-phase businesses that are either unquoted or listed on AIM (the London Stock Exchange’s market for growth companies). These businesses need investment in order to develop. They can potentially give you a high return, but they can also be much riskier than larger, more established companies as their shares can be illiquid and hard to sell. Also, you must remain invested for at least five years to keep the tax credit, so VCT shares are also long-term investments. Because of these factors, they should only form a small part of your overall investment portfolio. Please see the Important information and Further details below for further information.

The Enterprise Investment Scheme (EIS) is a scheme introduced by the government in 1994 to help small companies raise funds and grow. When you as a private investor invest in an EIS-qualifying company, you could receive very significant tax breaks. Companies qualifying for the EIS are small and usually privately owned, although they can be listed on AIM. They will typically have gross assets of less than £15 million at the time of investment and fewer than 250 employees.