difference between these two accounts?

funnymonkey · 21 April 2018 at 6:00AM

Good morning
Can anyone please tell me the difference between a stocks and shares isa and a fund and share account please?
Im guessing (maybe incorrectly) that with an isa you don't pay tax but with a fund and share account you do but I could be totally wrong.
Im up to my limit for my isa this current tax year and want somewhere else to buy my money and continue to invest in the shares Im interested in
Thank you

le_loup · 21 April 2018 at 9:27AM

Your guess is entirely correct.
You will pay tax in a non-ISA account on any capital gains and any dividends - subject to various tax allowances.

ColdIron · 21 April 2018 at 9:29AM

An ISA is a tax exempt account. Hargreaves Lansdown call their non-tax exempt account a Fund and Share account. It is liable for tax but there are several allowances that mean you may not end up paying any depending upon your personal circumstances and other sources of income but you will need to keep accurate records of purchases, sales and disbursements. It is a little cheaper to hold shares in but no cheaper for funds. There is no annual limit to how much you can put in it in the same way that there is for ISAs. You might consider a SIPP if you want another tax privileged account and can lock your money away until your mid or late 50's

Vortigern · 21 April 2018 at 9:33AM

Your guess is correct. No tax to pay on the ISA; possible liability to tax on the fund and share account, also known as a general investment account or GIA.

ISA limits the amount you can pay in each year. GIA has no such limit.

You can avoid income tax on the GIA by limiting investments that pay dividends or interest. You can avoid CGT by keeping your gains within the CGT allowance; take profits before the gain is too big.

difference between these two accounts?

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