The tax payable on the returns from an investment are largely determined by a combination of one’s own tax position and the taxation of the underlying investment vehicle used to shelter the investment.

National Savings offer a number of tax free investment vehicles such as Index Linked Savings Certificates, and ISAs also offer a tax efficient way of saving.  There are also more complex investment vehicles such as Venture Capital Trusts (VCT) and Enterprise Investment Schemes (EIS) that offer tax advantages.

Open ended investment companies (OEICS) and Unit Trusts are taxed differently to Investment Bonds (which are available both onshore and offshore with different taxation rules).

It is important that you choose the right investment vehicle or vehicles to ensure that you are not paying unnecessary tax.

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