Costs when withdrawing

Brricktop69

O am quite new to investments and have recently opened up a Vanguard account, at the moment I have a little over £1000  in there as i have been looking to put around £150 a month in it while I tried it out. I am now about to be mortgage free and as such will be around £1400 a month better off, i am looking to ramp up my investment to around £600 a month.
I am looking at keeping the money in there as a boost to my retirement in 15 years, one thing i am unsure about is about what happens when i finally decide to start withdrawing money from the account, I assume that i just sell my shares within Vanguard and the value is converted to cash. However I don't know what charges are applicable, will I pay tax on any money withdrawn? what would I be charged by Vanguard?
I have seen the charge is listed as 0.22%, is this applicable to withdrawals? Say I wanted to cash in £3000 of my shares would the cost be 0.22% of this value?

Any clarity would be appreciated.

TheAble

Is it in an ISA? No tax if so. If not an ISA then potentially capital gains tax liable (so use an ISA for preference). Vanguard don't charge on withdrawals. The 0.22% is the annual fund charge, usually taken from the fund rather than a separate charge. There's also a 0.15% annual platform charge.

maxsteam

Unless it's an ISA or pension, you will be liable to taxes in the year that you convert the shares into cash if you are lucky enough for the gains to be over £12300 (or whatever the CGT limit becomes in the future) in that year. It does not matter to the taxman whether you leave the cash with Vanguard or move it into a bank account. I believe that the 0.22% is the annual charge. It would be £6.60 per year on a £3000 investment. I do not think that Vanguard charge exit fees.

Brricktop69

Sorry i should have said, yes it is an ISA account.

maxsteam

Ah, then there will be no CGT on gains and no income tax on dividends. You paid your taxes on your income before putting the funds into an ISA wrapper so the taxman won't take any more from you.
If it was a pension, you would get tax relief at the time you paid in but you would be liable to taxes (subject to annual personal allowances) when you took money out.

Savingsfox

The 0.22% charge you refer to is the management fee being taken by Vanguard as a cost for running whatever fund you’re invested in, you’ll never see a physical charge taken from your account, but the total value of the fund is being charged 0.22% - think of it as their profit. 

You’ll not be charged for withdrawing money at this rate- most platforms don’t charge any fee or commission for buying and selling this type of fund.