When a GIA makes sense

GIAs are typically used once you've maxed out your ISA and pension allowances for the year. There is no contribution cap and you can withdraw at any time, but the lack of tax shelter means active management of allowances becomes important.

Key allowances to track

Each tax year you have a £500 dividend allowance, a £1,000 personal savings allowance (basic-rate; £500 higher-rate; nil additional-rate), and a £3,000 capital gains tax annual exempt amount. Anything above these limits is taxable.

• No annual contribution limit and no withdrawal restrictions
• Dividends taxed at 8.75%, 33.75%, or 39.35% above the allowance
• Capital gains taxed at 18% or 24% above the £3,000 exemption
• Useful for income flexibility once ISA and pension allowances are full