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BMO Global Asset Management: new tax free investment opportunity

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Becky AtkinsPublished: 31 March 2016


From 6 April 2016 the Dividend Tax Credit will be replaced by a new Dividend Allowance in the form of a 0% tax rate on the first £5,000 of dividend income. The update you can download below covers the changes in some detail and explains the impact on basic, higher and additional rate tax payers.

However, the headline for financial planners is that for higher/additional rate tax paying clients, this provides you with a new opportunity to provide an unwrapped investment (i.e. a general investment account (GIA) through an OEIC portfolio on a platform), with dividend income producing assets of circa £104,000* plus per person (over £208,000 for a couple) with no tax on the income received. This opens up a new tax efficient planning opportunity outside of pension and ISAs.

BMO's F&C MM Navigator Distribution fund currently yields 4.8% pa**, which would mean the income on an investment of around £104,000 would be completely tax free for all tax payers.

Download BMO's update on ‘Dividend taxation: change = opportunity’
Download BMO's Distribution Fund sales aid

For more information contact BMO direct on 0800 085 0383 or at

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