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FT Guide to Wealth Management by Jason Butler

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11

Minimising portfolio taxation

If your portfolio is not held in a tax-free or tax-deferred account like an individual savings account (ISA), self-invested personal pension (SIPP), small self-administered scheme (SSAS) or offshore portfolio bond (OPB), then tax will be due on interest, dividends and capital gains to the extent that they exceed your individual personal allowances.

To determine if total capital gains are taxable you need to first deduct all capital losses arising within the same tax year. Net capital gains in excess of the annual exemption, regardless of how long the investment has been held, are then taxed at either 18% or 28% depending on whether or not there is any unused basic rate income tax band available.

While your ...

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