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Just like with any other ETF (S&P, FTSE, etc.), mainly distributions of assets differ (and OCF). Check Vanguard vs iShares.

And the difference between vanguards ls100, global all cap and VWRL?

Likewise, the distributions. Global All Cap and VWRL are quite similar if you look at the list of constituent companies, but the former is significantly more diversified (6268 securities vs 3256 securities).

LS100, on the other hand, is some kind of their own mutual fund. Rather than having companies in it, it contains other Vanguard’s ETFs. However, it is very UK-centric and thus can be volatile due to the pound’s instability, whereas the other two fairly represent all other markets taking into account their respective sizes.

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Managment fees are probably different?

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:point_up: That too!

Great thanks. As far as I can tell they’re very similar with the vanguard etf skewed slightly towards longer maturity gilts whilst carrying a slightly higher ongoing charge.

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A post was split to a new topic: Verification issue

Will you be creating SIPP accounts? It’s a better container for the older investors.

It’s on the Road Map, to be worked on in the medium term:

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That’s interesting! Thanks.

Hi, a couple of beginner questions regarding tax:

  1. At which point in the fund would it be better to use a stocks and shares ISA? When would the £36 a year ISA fees be bettered by tax benefits gained?

  2. In terms of the capital gains thresholds - the table I saw with thresholds of approx £11,000 would require huge large amounts of investment to reach (hundreds of thousands?). Am I misreading the explanation in some way or being a bad mathematician? I read it as saying if you make a gain of over £11,000 on stocks in a year then you start to pay capital gains tax.

Thanks for your help

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Capital gains isnt over a year. It’s whenever the gain is realised. So if you invest now and then leave it for 20 years that’s still only an 11k allowance. Not 11k per year

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It is very subjective and depends on an individual. I started an ISA when I got to about £10,000.

Bear in mind that the gains are calculated historically, whereas your allowance is only limited to one year. If you invest £20,000 and in five years it turns into £40,000 and you sell, that is £20,000 gain, of which just about half will be offset by your Exemption Allowance.

Also, the dividends are also tax free in an ISA. The allowance is currently £2,000 but it was £5,000 only a couple of years ago, and may go up or down again.

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Thanks for your help.
The £10,000 comment is helpful, but I guess there must be a cut off point where generally speaking unless something odd is happening the tax benefits and gains outweigh the £36 fees? For example having an ISA when you only have £1000 would likely mean you lose more in fees unless there is a huge hike in your shares - would you agree?

In terms of your example regarding capital gains tax, Without an ISA in place to make it exempt, is the tax applied at point of return (in this case within the freetrade process) or does it become something I have to ‘declare’ myself at some point? Are all the fees and taxes dealt with this way or do I need to increase my self tax assessing abilities?

Thanks for your help

That is arguable. You could even have £100,000 without an ISA shelter, making sure you use your entire allowance every year, buy shares that would not give you more than 2% yield and all sorts of other things (e.g. Bed and Breakfast).

The main question is, would your time be less valuable than the £36 per year that will avoid it all? Taking £10,000 as an example, your fee will essentially be 0.36% per year, which is objectively not that much. For comparison, HL charges 0.45% (double if you have funds and stocks). And the fee is regressive, meaning the more your capital is, the cheaper it becomes (e.g. 0.036% once you reach £100,000).

You have to submit a Self-Assessment and state all your gains, brokers do not inform HMRC about your gains on your behalf.

If you have an ISA, it does not matter what your gains are, you will never* be liable for anything, which is the cherry on the cake :wink:

*Under current tax regulations

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It’s going to depend somewhat on if you have any capital gains coming from anywhere else. The capital gains limit is for everything not just stocks and shares

I have quite a lot of Dividend stocks in my ISA. It would probably have to get up to ~£40-50K before the dividends are in danger of going over the £2K limit, but you can’t put that much in in one year so you’d need to start earlier. I think it’s probably worth starting one with between 10-20K as Vlad said

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Chris Reining has done his homework and made a decent fortune (and lost some money during his journey). Published on Forbes and other sites. Very good at writing and explaining many ideas in concise way.

Bookmark this:

https://chrisreining.com/category/invest-to-build-wealth/

Under current tax rules :thinking:

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If you want to make your money work for you and start saving, why would you wait until £10K to start a Stocks ISA? Wouldn’t you just choose a lower fee platform? Or am I missing something big here?

Freetrade is the lower fee platform. GIA is % fee free, then switch to an ISA at a threshold of accumulated capital that suits you whether that be £10k, £20k, £50k, etc.

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