NSI Index-linked Savings Certificates

GeoffTF

John464 said:

soulsaver said:

There is no £100 fee at iWeb atm.

I've already got an account with iWeb and logged in to get a quote
There was about 1% difference between bid and offer
So 0.5% for each trade I guess?
Which is far more than I have been paying buying Vanguard and iShares Equity ETFs
Still not too to bad I guess
But what of the tax treatment?
I understand there is no tax on NSI Index linked - I have held 3 for about 15 years but never cashed one in.
If my MP was any good I would write and ask why they have done this?
As far as I can see, if the holder needs the money for an emergency, medical care or whatever, its in no one's interest to withhold it.  The holder would pay a reasonable penalty which benefits the taxpayer, and be less dependent on the state which again benefits the taxpayer.

What are you proposing to buy, and for how much? Index linked gilts have wide quoted spreads on the LSE. That reflects the price that you will get for small trades, which are costly to execute over the phone. The actual spread will be narrower for larger trades. I get better prices trading £50K+. Institutional investors get much better prices. iWeb does not allow you to talk to a dealer nowadays, so you will not know the price in advance.

soulsaver

GeoffTF said:

John464 said:

soulsaver said:

There is no £100 fee at iWeb atm.

I've already got an account with iWeb and logged in to get a quote
There was about 1% difference between bid and offer
So 0.5% for each trade I guess?
Which is far more than I have been paying buying Vanguard and iShares Equity ETFs
Still not too to bad I guess
But what of the tax treatment?
I understand there is no tax on NSI Index linked - I have held 3 for about 15 years but never cashed one in.
If my MP was any good I would write and ask why they have done this?
As far as I can see, if the holder needs the money for an emergency, medical care or whatever, its in no one's interest to withhold it.  The holder would pay a reasonable penalty which benefits the taxpayer, and be less dependent on the state which again benefits the taxpayer.

What are you proposing to buy, and for how much? Index linked gilts have wide quoted spreads on the LSE. That reflects the price that you will get for small trades, which are costly to execute over the phone. The actual spread will be narrower for larger trades. I get better prices trading £50K+. Institutional investors get much better prices. iWeb does not allow you to talk to a dealer nowadays, so you will not know the price in advance.

@John464 isn't talking about gilts - he's on topic. Yes, I know it's unusual for MSE....

John464

soulsaver said:

GeoffTF said:

John464 said:

soulsaver said:

There is no £100 fee at iWeb atm.

I've already got an account with iWeb and logged in to get a quote
There was about 1% difference between bid and offer
So 0.5% for each trade I guess?
Which is far more than I have been paying buying Vanguard and iShares Equity ETFs
Still not too to bad I guess
But what of the tax treatment?
I understand there is no tax on NSI Index linked - I have held 3 for about 15 years but never cashed one in.
If my MP was any good I would write and ask why they have done this?
As far as I can see, if the holder needs the money for an emergency, medical care or whatever, its in no one's interest to withhold it.  The holder would pay a reasonable penalty which benefits the taxpayer, and be less dependent on the state which again benefits the taxpayer.

What are you proposing to buy, and for how much? Index linked gilts have wide quoted spreads on the LSE. That reflects the price that you will get for small trades, which are costly to execute over the phone. The actual spread will be narrower for larger trades. I get better prices trading £50K+. Institutional investors get much better prices. iWeb does not allow you to talk to a dealer nowadays, so you will not know the price in advance.

@John464 isn't talking about gilts - he's on topic. Yes, I know it's unusual for MSE....

Well I am interested in both really
Is it worth cashing in NSI Index linked bonds at maturity and buying index linked gilts on iweb?
(On the grounds they could be cashed in an emergency - fixed rate accounts have been suggested instead but you may not be able to cash them in early either.)
What of the tax treatment?

John464

JamesRobinson48 said:

Coupon payments on index linked gilts are taxable. 

Thanks for the reply
Does that mean the payment you receive for index linking is not taxable?
So you don't have to declare it?