Buying gilts - which platform to use?

TheTelltaleChart

https://forums.moneysavingexpert.com/discussion/comment/81962987#Comment_81962987

You may already know all this, but …

The extra 2% will apply to interest on gilts as well as to savings interest.

However, that is just on taxable interest you get from gilts; if you get a capital gain from gilts, that is not taxable (unless they change the tax rules, of course—but I've seen no suggestion that this might be changed). And if you buy a short-term conventional gilt at a price below face value, and hold it to maturity, you can be sure you will get a capital gain.

The accrued interest you pay when buying a gilt reduces the number of units you can buy with a given amount of cash. However, it reduces the amount of taxable interest you are regarded as having received from the gilt. E.g. suppose you pay 100 days' accured interest on purchase; at the next payment date, you will be paid 6 months' interest, but you are taxed not on the full 6 months' interest, but just on the 6 months interest minus the 100 days' interest you paid earlier.

Money_Grabber13579

I’ve just bought short dated low coupon gilts through Scottish widows. I was attracted by the low costs, being £5 dealing charge (I presume the same again on maturity) but no ongoing fees. HL now seem to charge a percentage fee for holding gilts otherwise I probably would have gone with them.

masonic

https://forums.moneysavingexpert.com/discussion/comment/81963273#Comment_81963273

"I don't think it is true that only AJBell do that. I would suggest you do a dry run of buying a conventional gilt at HL (without pressing the buy button) and see what information you get."

There seems to be a lot of confusion in the latter part of this thread. @mills112 has hijacked a thread where the OP is "considering buying some (conventional and index-linked) gilts and am not sure about which platform to use", taken posts clearly specifying they are referring to ILG out of context, and only after some back and forth declared that his situation is different than the OP in that he is not looking to buy any ILG (despite making comments implying otherwise, such as "it is difficult to work out the real yield on the gilt" - perhaps not understanding that "real yield" has a different meaning in the context of this discussion).

AJ Bell is the only provider that tracks the current valuation of ILG inclusive of index linking for existing holdings on the portfolio summary screen.

All providers will tell you the actual dirty price obtained and accrued interest when you execute an order. They have to in order to provide you with a total consideration. That's true of both conventional and index linked.

InvesterJones

https://forums.moneysavingexpert.com/discussion/comment/81963342#Comment_81963342

No selling fee for Scottish Widows if you keep to maturity, so just the £5 buy. They're my platform of choice now for that reason.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/81963406#Comment_81963406

It's normal, I've not been charged a fee by any broker when something's matured or e.g., cancelled due to a corporate action.

mills112

https://forums.moneysavingexpert.com/discussion/comment/81963266#Comment_81963266

as an example here is a gilt that you can buy on HL and it does not state when the coupon date is, so do you get that from a google search?

there is also a bid offer spread, which could change so it is not as simple to match a fixed interest savings account as some people are suggesting as an alternative, although I guess if you are holding the gilt to maturity then the bid offer spread does not matter to you. not to mention there is no FSCS protection on the investment, if you can rely on HL actually buying the gilts as they could fail to do this in a crisis or fraud and you are stuffed.

https://www.hl.co.uk/shares/shares-search-results/t/treasury-0.375-22102026-gilt

mills112

https://forums.moneysavingexpert.com/discussion/comment/81963406#Comment_81963406

so scottish widows seem to be the best platform to buy fixed gilts then as they have a low dealing charge and don't charge you for holding gilts.

mills112

https://forums.moneysavingexpert.com/discussion/comment/81963299#Comment_81963299

yeah, that is why some people were suggesting with the new 2% tax, it is more tax efficient to buy fixed gilts where capital growth is not taxed. i didn't know how the accrued interest is taken into account, whether it was added to the purchase price but the comments state that your next coupon payment is reduced.

wmb194

https://forums.moneysavingexpert.com/discussion/comment/81963751#Comment_81963751

Freetrade’s even cheaper with no dealing commission but its range is relatively meagre. I’m hoping it’ll add some more.

mills112

https://forums.moneysavingexpert.com/discussion/comment/81963755#Comment_81963755

i am just planning ahead for the new tax change. i will read through all the platforms but at the moment, from the comments Scottish Widows seem to be a good one for holding gilts because of their low fees.