How do I reduce capital gains tax on my UK investments?
I've started investing in some UK stocks and funds this year through my Trading212 account and I'm a bit worried about capital gains tax. I've made around £4k in profits so far (mostly from tech stocks doing well) and I know there's some kind of tax-free allowance, but I'm not sure how to make the most of it.
I've been reading about tax harvesting and bed & breakfast rules but honestly, it's making my head spin! Should I be selling some investments before the tax year ends? And do I need to wait 30 days before buying them back?
Thanks in advance!
1 Answer
What type of Trading212 account are you currently using? If it's just a standard Invest account, you're leaving free money on the table!
With £4k profits already, you're over the £3k tax-free CGT allowance. The smart move is opening a Trading212 ISA immediately - everything inside is completely tax-free. No CGT forms, no tax bills, no headaches.
You might want to sell some winners before April 5th to use this year's allowance, and possibly offset gains by selling underperformers. But honestly, the ISA should be your priority - £20k limit each year that you don't want to waste.