The benefits of an holistic view of investment advice

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Being a Financial Planner starts with building a long term financial plan to assist with the attainment of an individual’s lifetime goals. Investment management is an important part of our role, as is tax planning. We strongly believe that one the best investment outcomes cannot be achieved without an holistic view.

This is why it puzzles me that many full time Investment Managers have been very slow to highlight to their clients the significant changes to dividends that are occurring in April of this year.

Specifically, all dividends will cease to be treated as tax paid for basic rate tax payers, and instead will be subject to an additional 7.5% income tax charge, in addition to the Corporation Tax they have paid at source. There will be a £5,000 allowance for all individuals, but for most people receiving a dividend from their investments will see their net return reduced by 7.5%.

Wingate Financial Planning employs a “total return” approach to investments as we already are aware that most individuals do not use their capital gains tax allowances and these changes will mean that our investment strategy has further validation.

Our clients enjoy a return that on a risk adjusted basis will be expected to be greater than it would be from their investment manager due to the tax planning that we undertake.

What is surprising is that almost universally these changes are not being communicated by the same investment managers, the worse of these, working at private banks and or “Wealth Managers” spend their efforts bamboozling their clients with investment jargon, and unfavourable pages of data, but have not communicated this significant change that will reduce prospective returns.

If you are concerned about anything above please do not hesitate to get in contact and we will be able to explain how Wingate can take a more holistic view of your finances, covering a raft of areas including tax planning and mitigating changes to legislation such as these on your investment plans.

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26 Apr 2024

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