Tax on Investments in a General Investment Account

Kay55_2

Hi, I should be grateful for some guidance.  I find myself with £30k to invest and no available headroom in ISAs or pensions.  I would like to keep things as simple as possible for tax and only realise a CGT liability on sale of investments in the GIA (and I would intend not to exceed an annual gain of £3k to keep within my allowance).  Can I just ask a couple of queries on income tax.  If I choose UK listed shares which are non dividend paying would CGT be my only concern?  I usually invest in investment trusts - if I chose to buy say JP Morgan Indian Investment Trust (which doesn't pay dividends) in my GIA am I right in thinking there would be no income tax to pay.  I suspect it may be more complex than this though?! Any pointers helpful - I really don't want to have to report additional income on GIA investments if I can avoid that. Many thanks  

eskbanker

Income tax is only chargeable on income, so if your unwrapped investments don't provide any income then there's no income tax liability!  However, it may be letting the tax tail wag the investment dog to use potential income tax liability as a driving factor in your choice of investments....

jimjames

You'll get £20k into ISA in April, is it worth waiting until then? Selling and rebuying after 2 months doesn't seem like a good idea cost wise. Also are you really paying the maximum into pension if you're earning under £60k?

ColdIron

If you restrict yourself to zero dividend trusts you will be fishing in a very small pool of things that wouldn't usually be at the top of your list. I wouldn't place such artificial constraints on my investment strategy, many large or global trusts are not high dividend payers anyway

Dividends are easy, with a small extra allowance and low tax rate. Investment Trusts are about as easy as it gets tax wise

VastPace1824

ColdIron said:

If you restrict yourself to zero dividend trusts you will be fishing in a very small pool of things that wouldn't usually be at the top of your list. I wouldn't place such artificial constraints on my investment strategy, many large or global trusts are not high dividend payers anyway

Dividends are easy, with a small extra allowance and low tax rate. Investment Trusts are about as easy as it gets tax wise

I agree with this! It'd be better to focus on good investment choices rather than strict dividend avoidance.