Once you have used your ISA allowance, but still have excess money to invest for the longer term our Investment Account should be considered. Our popular investment portfolio’s are available whether you are investing in an ISA, Pension or Investment Account; the only difference is the way in which the investment funds are taxed.
Holding the investments outside the ISA or Pension accounts can still be very, very tax efficient. The portfolios we recommend are designed to produce both capital growth and income. The income that is generated is either paid out to you or re-invested, but either way is subject to tax, which is automatically deducted at the basic rate of tax. However, the capital growth part of the investment (which could be significantly greater than the income) is taxed as a capital gain. Most of us overlook our capital gains tax allowance each year, but it is almost twice as much as our income tax allowance. Most of us do not use our Capital Gains Tax Allowance (which is £10,200 for the 2009/10 tax year). Even if we do, the rate of capital gains tax beyond this limit is a flat rate of 18%.
Standard Life sends a consolidated tax statement to you at the end of each year and in most cases the taxation of the investments is completely taken care of for you.
Remember – we do not handle clients money – We merely instruct Standard Life where to invest your money and for how long. Any money changing hands is strictly between you, Standard Life and the underlying investment manager.
Switching between investments held within your investment account can normally be achieved within 24 hours. Usually, investment account providers will take around 5 working days to complete a switch during which time your money is not invested.
The investments held within our suggested portfolios are professionally selected and constantly monitored. The managers that we employ know what is expected of them all of whom can be replaced within days if they do not meet with our expectations. We simply email you when a change is necessary.
Periodically, we will let you know when a ‘re-balance’ could be advantageous. A rebalance is used to reset the investments to their original position. Over time the investments held within the portfolio will inevitably perform differently. The rebalancing process allows you to take profits from the investment sectors that have done well, increasing exposure to investments that have underperformed (the theory being that last years winners will be next year’s losers and vice a versa). A rebalance can take place within 24 hours.