Best General Investment Account UK

Choosing the right investment account: GIA or ISA?

The difference between an ISA and a general investment account lies in the tax treatment on any gains made from assets held within the investment account.

An ISA is what’s known as a tax-wrapper, meaning any gains made from investments held within the ISA are protected from capital gains tax. There is an annual allowance of how much you can save into an ISA in any tax year, and this currently stands at £20,000 for 2022/23. Anything over this amount will be subject to tax at the normal rate.

Conversely, a general investment account is a means of investing without limits, however, the investment gains made from assets within a general investment account will be subject to capital gains tax at the normal rate for the account holder. Therefore, a general investment account is an excellent investment vehicle for anyone who has maxed out their ISA allowance.

What are investment platforms?

Investment platforms allow investors to buy, hold and sell a range of investments online. They usually aim to simplify investing in order to make it accessible to all walks of life, regardless of investment experience.

Most investment platforms will focus on making investing fun and accessible by cutting out financial jargon. There is usually a cost involved and the range of available investments, and accounts will vary between different platforms. Some investment platforms have gone fully mobile by offering an app from where you can manage your account.

Top five investment platforms for beginners

For complete beginners it is best to look for a platform with a good range of ready-made portfolios that are managed for you. Beginners will also want to be aware of costs, as this can start to eat away at your gains, especially for small investment amounts. My pick of the top five platforms for beginners are:

1. Nutmeg: Nutmeg offer a fixed allocation portfolio which would be one of the most cost-effective ways to invest. They are also on hand with financial advice should you require help with your selection
2. Vanguard: Vanguard retains its position as one of the cheapest ways to invest and their Lifestrategy portfolios continue to perform well and gain in popularity. This could cost you as little as 0.41% per year.
3. Freetrade: The free share you get when you join Freetrade can help instantly boost your investment pot and their simple, no-nonsense platform is a breeze for newbies to navigate.
4. Moneybox: Moneybox allows you to start investing with as little as £1 and the first three months are completely free from any monthly subscription fees.
5. AJ Bell: AJ Bell have a really well-designed app that continues to attract investors. For newbies, the lack of inactivity fee is a major drawcard and there is plenty to offer more experienced investors as your confidence grows.

How to choose an investment platform

There are plenty of options available which can make choosing difficult. However, when making your selection you should consider the following:

• Is there a mobile app so you can manage your investments on the go?
• What are the costs and how will they affect your pot?
• What is the selection of ready-made portfolios like and what range of asset classes does the platform provide?
• Is there the option to invest ethically?
• What is the customer service like as this can affect your overall experience
• Does the platform offer the account of your choice?
• Is the investment provider safe and is it part of the Financial Services Compensation Scheme and the Financial Conduct Authority?
• Will you also require a savings account?
• What is your investment style? Would you prefer to pick your own investments or sit back and have someone do it for you?
• Are there any inactivity, deposit or exit fees to contend with?