Tax on investments

If you earn an income from your investments, you might need to pay an amount of tax.

 
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Explore tax guides

You’re responsible for paying any tax that’s due, but knowing what applies can make things much simpler.

These guides will help you to understand the following:

  • Capital Gains Tax
  • dividends tax
  • tax-efficient investing.

Capital Gains Tax

Capital Gains Tax (CGT) applies to the profit you make when you sell or dispose of something that’s gone up in value. It’s only the gain that’s taxed, not the total amount you receive.

When you sell shares, the gain is worked out by subtracting the original purchase price, including any related costs from the selling price.

In the UK, individuals have a yearly CGT allowance of £3,000 for the 2025/26 tax year. How much CGT you pay above the allowance depends on your income tax band.

You won’t pay CGT on gains earned within a UK pension scheme or ISA. 

Captital Gains Tax guide

Tax on dividend

Dividends are a portion of a company’s profits that are paid to its investors. Everyone has a dividend allowance, which is £500 for the 2025/26 tax year. This means you can earn up to the allowance in dividends each tax year without paying tax.

You won’t pay tax on UK dividends within a UK pension scheme or ISA although taxes or fees could apply to foreign stocks and investments.

How dividend tax works

Autumn budget 2025

The government budget, released in November 2025, included some key information about tax thresholds, rates and ISA reforms.

Make sure you understand how these changes could affect you.

The autumn budget

ISA subscriptions

ISA subscriptions allow you to save a set amount of money each tax year that is protected against UK capital gains and dividends tax. The amount is £20,000 for the 2025/2026 tax year.

You can subscribe to multiple ISAs of the same type (except for Lifetime ISA) within the tax year. All subscriptions must stay within the overall ISA limit of £20,000.

ISA allowances

Our investment options

We offer a range of tax‑efficient ways to invest.

Tax efficient investing

There are tax-efficient investment options you can consider, which could help to keep more of the returns you earn in your pocket. These include ISAs, pensions and a handful of gilts, schemes and trusts.

Tax-efficient investing

Investing for longer increases the likelihood of positive returns. Over a period of 5 years or more, investments usually give you a higher return compared to cash savings. But investments can go down as well as up in value, so you could get back less than you put in.

Managing your tax responsibilities

Reporting and paying tax

For information and support with all forms of tax, allowances, completing returns and making payments, refer to the government website.

You might like to seek independent financial advice if you need help with your tax obligations. Just be aware that charges could apply.

Personal financial advice

If you have a sole income of £100,000, or joint savings, investments and pensions of £100,000, Schroders Personal Wealth could help you achieve more. 

Schroders Personal Wealth

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