The RXK Tax Policy
The funds you earn from your investments are just like any other funds you might be earning from your job or business. Earning incurs taxes. Your tax varies with the type of investment you place and how much you make in return. Here are some of the taxes you should be aware of; Income Tax, Capital Gains Tax, and Stamp Duty Reserve Tax.
- Income Tax
Any interest you make from your investment is subject to Income Tax. This means that you’re also responsible to pay Income Tax on interest from savings accounts and interest earned from peer-to-peer investments. If you’re a basic rate taxpayer, you’ll pay 20% income tax on any interest you make.
Please note that taxes apply to all accounts, but they vary from one country to another. It may be 12% or more. The taxes are paid at the end of the financial year, which means June. Tax may also be applied when the client withdraws their profits. Taxes cannot be deducted from a trading account, hence why they need to be paid in person from the client’s bank account only.
- Buy Share:
When you buy shares, there’s a tax or duty of 0.5% on the transaction. However, when you buy shares electronically, the kind of tax differs in which you pay Stamp Duty Reserve Tax (SDRT), using a stock transfer form. If your transaction is above $1,000, you’ll need to pay Stamp Duty.
- Sell Share:
You may have to pay Capital Gains Tax if you make a profit (‘gain’) when you sell (or ‘dispose of’) shares or other investments.
When You Don’t Need To Pay Taxes
The only time you do not need to pay tax is if you give shares as a gift to your husband, wife, civil partner, or a charity and of course, declaration needs to be made in advance only.
You also do not pay Capital Gains Tax when you dispose of:
- Shares you’ve put into an ISA or PEP
- Shares in employer Share Incentive Plans (SIPs)
- Government gilts (including Premium Bonds)
- Qualifying Corporate Bonds
- Employee shareholder shares – depending on when you got them
Shares and Investments Need to Pay Tax on:
- Units in a unit trust (include Indices)
- Withdrawing crypto from the wallet (certain countries only).
- Certain bonds (not including Premium Bonds and Qualifying Corporate Bonds)
*Each client is responsible to arrange his/her taxes on time. A delayed or late payment shall include extra costs and fines.