Trading 212 vs Stocks shares Isa

lon_85

Hi guys 

I'm new to stocks and shares just started trading 5 shares with a few hundred pounds in the Trading 212 app - I know that we have 20k tax free allowance in stocks and shares isa but was wondering if that is better? Although its tax fee need to pay set up fees and trading charges etc The trading 212 app has no fees but I still need to pay tax on my returns which is only £50 so far 

Also I heard its only worth opening the stocks and shares isa if I plan on making more than 12k a year in profits in trading which right now definitely won't be the case as I'm just starting out - is that true?

Any advice on this would be much appreciated.

Ps - I already have normal cash isa and Lisa which I'm already depositing each year but as interest getting very low looking to diversify into stocks.
Thank you

cloud_dog

lon_85 said:

Hi guys 

I'm new to stocks and shares just started trading 5 shares with a few hundred pounds in the Trading 212 app - I know that we have 20k tax free allowance in stocks and shares isa but was wondering if that is better? Although its tax fee need to pay set up fees and trading charges etc The trading 212 app has no fees but I still need to pay tax on my returns which is only £50 so far 

Also I heard its only worth opening the stocks and shares isa if I plan on making more than 12k a year in profits in trading which right now definitely won't be the case as I'm just starting out - is that true?

Any advice on this would be much appreciated.

Ps - I already have normal cash isa and Lisa which I'm already depositing each year but as interest getting very low looking to diversify into stocks.
Thank you

I think you meant to say... "No advertised fees".

Their charges are somewhat opaque.  For example their own T&C confirm that they can load the bid/offer spread (to your detriment); whether they do or not is difficult to tell.  They do not execute real time transactions; they attempt to bundle buys/sells together and execute in as efficient a transaction as they can (for their benefit, i.e. reduced transaction charges).

So all very opaque.

For someone starting off wanting to dabble with small amounts, I'm sure they are fine.  Letting them hold your many tens of thousands of ££££ in their ISA, perhaps not so much.

Back to your question re CGT... You just need to ensure you keep adequate records of buys/sells and their corresponding dates just in case.  That is the other benefit of using an ISA, it simply removes that administration headache.

Grenage

Don't 212 have a S&S ISA service?  There are no good reasons to not use such if you haven't maxed your contributions.

csgohan4

A good article for S+S isa 
https://www.moneysavingexpert.com/savings/stocks-shares-isas/

it is completely tax free on any profit you make, no limit. so for example you put 20k a year and it increased in value to 40k, no tax at all on selling.

Bare in mind dabbling in individual stocks is risky. But personal preference

Global index trackers are better for diversification  for starters. Keeping cash in an ISA will only be earning very little

The monevator website is good on researching how to passive invest

Tolteca87

If you have not already got an ISA this year, open a T212 ISA and bed and ISA the holdings into the ISA. This means sell it in the Invest account transfer the money over into the ISA account (min £10) then buy back in the ISA. with the cash you transfered over. Very small cost with stamp, bid offer spread etc but no future tax hassles and the holdings and dividends from them will become free of tax. Sorted.

DireEmblem

Just to check, but have you used up your capital gains allowance, UK citizens I think get 12k a year.

HansOndabush

Trading 212 are 'Mickey mouse's outfit who don't even seem to know what a share certificate is. I wouldn't  use them for serious amounts of money.

JustAnotherSaver

For those who pan Trading212 would you also pan Freetrade?

HansOndabush

If I knew what 'pan' meant, I might be able to reply?

gollum007

JustAnotherSaver said:

For those who pan Trading212 would you also pan Freetrade?

Personally no.

Having said that, you have to remember they have a different set of limitations & risks attached.
At the minute, I'm not sure they yet have a financially viable long-term plan other than perpetual unicorn growth.
The Plus stock limitations are a little irritating, and IMHO the wrong tack to take & even with them, SIPP charges etc. it feels like they are still going to be loosing money on the average customer.

On the plus side, they have a clear / standard custody arrangement (other than for fractionals) & a 'normal' best execution policy.

grumiofoundation

HansOndabush said:

If I knew what 'pan' meant, I might be able to reply?

To criticise severely.