Best holdings in a GIA - tax purposes

EdSwippet

Adyinvestment said:

What are the best holdings to have in a General Investment Account for UK tax purposes?

Notwithstanding a few disparaging 'tax tail wagging the dog' comments above, this is a sensible question if phrased more specifically. Given a desire to hold a range of assets (or specific funds or ETFs) in a given allocation, what is the best location for those things?

Historically, a large part of the return from stocks is capital gain, whereas most of the return from bonds is in interest or dividends. Capital gains are only taxable when realised (sold), but interest and dividends are taxable annually. Stocks held outside of ISAs and pensions can benefit from greater tax-deferred roll-up than would bonds held in the same account.

This Monevator article teases out some details: Tax efficient investing in the UK (or what order to put things into an ISA or SIPP)

Adyinvestment

EdSwippet said:

Adyinvestment said:

What are the best holdings to have in a General Investment Account for UK tax purposes?

Notwithstanding a few disparaging 'tax tail wagging the dog' comments above, this is a sensible question if phrased more specifically. Given a desire to hold a range of assets (or specific funds or ETFs) in a given allocation, what is the best location for those things?

Historically, a large part of the return from stocks is capital gain, whereas most of the return from bonds is in interest or dividends. Capital gains are only taxable when realised (sold), but interest and dividends are taxable annually. Stocks held outside of ISAs and pensions can benefit from greater tax-deferred roll-up than would bonds held in the same account.

This Monevator article teases out some details: Tax efficient investing in the UK (or what order to put things into an ISA or SIPP)

Thank you - yes that is what I was referring to.
Having a fund which has most of the gains as interest and dividends would seem to be a huge disadvantage for a higher rate tax payer when compared to a fund comprised of growth stocks.