What is a General Investment Account (GIA)?

A GIA is a flexible way of holding a range of different investments. Unlike an ISA or pension scheme, there are no annual or lifetime limits on how much you can pay in, and no restrictions on when you can take your money out.

Should I open a GIA?

A general investment account may be suitable if you have used up your annual ISA allowance or if you don’t want to lock money away in a pension scheme until the age of 55. You can transfer money from a GIA at any time, making it a useful ‘holding’ account until your ISA allowance renews at the start of the new tax year. Everyone’s circumstances are different – speak to a financial adviser to find out if a GIA is suited to your needs.

The value of investments and the income derived from them may go down as well as up.

Is it tax-free?

No. You will have to pay income tax on interest or dividends earned and capital gains tax on gains realised within your account, as GIAs don’t have tax-free benefits. The sale of assets within your GIAs may be liable to capital gains tax, although you do have an annual allowance of £11,300 in the 2017/18 tax year – an allowance many people fail to use. The amount that you pay will be based on your personal tax circumstances. 

Tax reliefs are dependent upon personal circumstances, and pension and tax rules are subject to change by the government.

GIAs provide flexibility with no restrictions on the amount you pay in or take out, but they don’t offer the same tax-benefits as other accounts. Speak to an independent financial adviser at AFH to learn more about GIAs and how they may be able to benefit you.

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