In detail

A Tax efficient Plan & product

There are few tax advantages available to savers in the UK. They come in the form of tax allowances on an annual basis and are generally lost if not utilised each year.

The dividend income allowance will be subject to change in the future. It is currently set to reduce to £2,000 from April 2018.

An ISA (individual savings account) is one of the most tax ecient savings vehicle available to UK investors. An ISA shelters your investments from paying tax as it grows and when you start to take an income. Any income you take from an ISA is tax free and there are no age limits to access these funds.

Did you also know that every individual in the UK can earn £5,000 from dividend income without being liable to income tax, regardless of the investments being held within an ISA.? www.gov.uk/tax-on-dividends/how-dividends-are-taxed.

We have developed two variations of our dividend income plan in order that you can easily utilise these tax advantages.

ISA version

The ISA version of the plan will allow you to invest the maximum allowance (£15,250 for 2016/17, £20,000 for 2017/18) or transfer an ISA portfolio from other providers. The portfolio will grow tax efficiently and any income you receive is free of income tax. If you have to sell the investments in the future, there is no liability to capital gains tax (CGT).

Direct version

The direct version of the plan will allow you to receive dividend income that is tax free up to £5,000 per annum. You will not have to declare any income received via our direct plan until this exceeds £5,000. It is important to note that if you are receiving dividend income from other sources this will also count towards your annual allowance. If you have to see the investments in the future, you will be liable to capital gains tax.

Any tax that may be applicable to income above £5,000 per annum or relating to capital gains will be subject to your marginal tax rate.