How Does Your Day Job Salary Effect Capital Gains On Investments?

First Time Investing šŸ£
1

Hi there,

Iā€™m new to investing so any help much appreciated! Iā€™ve tried getting to the bottom of this but canā€™t seem to find a clear and definitive answer.

My question is on the tax-free allowance of Ā£12,300 in the UK and on investments made outside of a tax-free wrapper like a stocks and share ISA. Letā€™s imagine I have a job that pays a 80k yearly salary on which tax is taken by the government based upon those earnings. If, separately I were to make profit on investments and then sell them to the amount less than Ā£12,300 - will I or wonā€™t I need to pay any more tax to the government beyond what I would already be contributing through my jobs salary?

Thanks,

Robin.

2

Capital gains up to the threshold are separate from income, so once youā€™re below the threshold you shouldnā€™t have anything to pay, regardless of how much you earn. However, above the limit, the amount you pay is graded based on your taxable income.

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3

Great thanks for clarifying. I assumed that was the case. The reason I wanted to know as I was hoping to make some returns outside of my stocks and shares ISA, which I might later then put the returns into.

Cheers!