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Fixed Rate Bonds

  • 28 October at 21:32 - by hui_c - 478 views

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Fixed Rate Bonds or ISAs or are they the same!?  Help I’m confused!

7 Answers

Interesting question as Fixed Rate Bonds are very similar, and both offer in 2018 a good rate.  The only down side is that with ISAs you can only invest a max of £20k and as they are fixed rate the rates are lower than if you go for an Innovative Finance ISA where of course the risk is bigger but the yields are bigger.

28 October at 22:14 - by JeffW2116

Excuse my ignorance but it’s often better to ask people than to Google it as you can easily get confused, what about the tax as I don’t think you have to pay it on an ISA?

29 October at 08:00 - by  hui_c

Sorry I meant to say that, you can invest tax free up to £20k per year but like I say, the rates are lower.  It depends what you want.

29 October at 18:40 - by JeffW2116

You need to look at any sort of investment bond as a medium to long term investment as you are essentially bankrolling the government or a company depending on what you chose and to cash out quickly wouldn’t achieve the objective.  There are risks and there is tax to pay if you don’t go for the ISA option.

30 October at 00:29 - by edwardt

SO how does the tax work?

31 October at 16:11 - by  hui_c

Income tax:  so basically you can get up to your personal tax allowance then after that you have to pay income tax on the gains made from the bonds at 20% but there are ways around it.  Have a look into it.

31 October at 19:00 - by edwardt

Also don’t forget that some have a minimum investment for example £10k.  It’s a great investment though but just don’t expect to get your money back out quickly.

01 November at 23:11 - by JeffW2116
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