Mitigating investors' income tax liabilities

A number of investments are subject to income tax rather than capital gains tax, but before your client invests in them you should consider which suits his or her tax position better

The taxation of an investment is an important element in the advice process and one which at times can be the key determinant of a product recommendation. Here we look at income tax and implications for investors of different investment products. Income tax at the highest marginal rate is payable on all investment income. Investment income includes the following. a) Interest paid on bank and building society saving accounts. Typically on these accounts, basic rate tax liability of 20% is deducted at source and any higher rate liability is paid by the investor via his or her tax returns. ...