Set-&-Forget Investing in ETFs & Options – for Lasting Growth & Income …

Use it or Lose it


With less than two weeks until the end of this tax year (5th April), here’s some info to help nail the idea of free money that is widely available from HMRC (which relatively few people take advantage of).

Taxes are one of three major leakages from our wealth – the other two being fees and inflation. Read my piece on how to reduce fees and this one on turning inflation to our advantage.

Any time we allow a leakage to persist, we’re actively allowing money to move away from us (and our future, and our family’s future) to someone else.   It’s never too late to stop this and it’s easier than you might imagine.

Money moves from those who don’t manage it to those who do” … Dave Ramsey (American personal finance commentator)

Tax Allowances:  Free Gifts

We’re talking £’000s per person – which could be going straight into your pensions (incl SIPP & SSAS) and ISAs – per annum.

These government ‘gifts’ are so generous that everyone should utilise them as much as possible  (examples below)

Pension Contributions

If you can make contributions into a pension, you’ll almost always get a free-money top-up from HMRC (the amount depends on your tax rate).

As a 40% tax-payer, adding £10k into your pension will only cost you £6k, with the £4k being your free money from the government.  A 20% tax payer would receive £2k in this example.

Think about it: that amounts to an immediate 66% return on your investment.  Which doesn’t even include any future returns when invested properly.

An alternative way to think about this is that even if your contributed amount lost 40% of value, your original capital (£6k) is still intact.

We can contribute up to £60k per annum into a pension.  And more if you’re able to carry forward the past three years worth of unused allowances.

Pension contributions may also reduce your taxable income, allowing you to take advantage of more favourable marginal tax rates etc.

Always check with your accountant to see how you qualify to make these contributions.

Ltd Company Contributions

If you have a Ltd company, it can make pension contributions for you and saves on corporation tax.   The same allowances apply – i.e. your Ltd company can contribute up to £60k into your pension every year.   This is an ‘expense’ for your Ltd Company, so reduces your Corporation tax.


In the UK, only 6% of people have a Stocks and Shares ISA. In the US the equivalent number is 17%.

ISAs are another powerful way of tax-efficient investing.  All income and gains in an ISA are tax free forever – even at the point of withdrawal.   This allows long term passive compounding of your gains, with tax-free protection.

Adults can contribute up to £20k per annum in an ISA.  Children have an allowance of £9k pa.  There are three main types of ISAs available:  Cash, Stocks and Shares, and IF-ISA.  We can spread our allowances across the different types as long as we don’t exceed the £20 overall.

With ISAs there is no carry forward so come April 6th, your allowance for the previous year will disappear.

Capital Gains Allowance

This is another major one but the allowances have been reduced over the last few years.   For this tax year, we can make up to £6,000 in capital gains before paying tax.  From April 6th that reduces to £3,000.

Again, you can’t use up previous year’s allowances so come April 6th, last year’s allowance disappears.  So if you have gains, you may wish to think strategically about this.

If you have made (realised) losses, these can be indefinitely offset against future (realised) gains.  To qualify, you must declare these losses within 4 years.

Income made on Options is classified as Capital Gains by HMRC.

The tax rates are 10% for a basic rate payer and 20% for higher rates.   For residential investment property, that becomes 18% or 28% (falling to 24%).

Use it or Lose it

You can see how big a difference this stuff makes.  So make sure not to miss the deadline!

Successful Investing is not just about the investment gains.  Just as important (sometimes more so) is taking advantage of tax breaks, minimising those leakages, and being set-up properly.

Super Compounding

All of this will really move the needle in achieving future financial security – for you and your family.

When combined with proper investing, I call this Super-Compounding – read about it here.    It’s something i’m super passionate about when working with investors.

My Podcast interview

As mentioned, one of the other big leakages is the fees we pay to our work pension scheme or indeed any other funds managed for us – eg by an IFA or a Wealth Manager.

I was interviewed by Wealthbuilders on investment fees and how anyone can slash this big wealth leakage.

Apple users can listen to my interview here.

Spotify users can listen here

Wealthbuilders – Financial Security Webinar

As a coach with Wealthbuilders, i have the privilege of helping people create income from assets (instead of income from their time).  Through my role as coach, I’ve helped many people reach a position of financial security

Next Wednesday, Wealthbuilders is holding a live webinar to demonstrate the steps needed to achieve financial security.

Join this informative webinar to get some insights that might inspire you to do the same.  More info and Register here.

Always Remember:

  • Time in the Markets always beats timing the markets
  • Stay Diversified 
  • Minimise those leakages:  Fees, Inflation, and Taxes
  • Financial Markets are a great source of recurring income  
  • ETFs, Balanced Funds and Options achieve all the above
  • Being educated helps you outperform 99% of the population


… to ensure your investments work for YOUR financial freedom (not someone else’s)     

And … 

For more guidance, our Investment Academy will help you implement all of this in a step-by-step way.   

Thousands of people have learnt how to diversify and pound-cost-average into low-cost, set-and-forget ETFs & Funds for inflation-beating growth.  And Options to create recurring income.

Click here to learn about our Investment Academy

Finally …

– Don’t take the above as advice as it may not apply to you personally

– Your Capital is at Risk

– You may not be covered by the FSCS

– Anything mentioned in a podcast or in a previous article was valid at that time and may not continue to be now


Stockmarket Investment Academy … Step-by-Step Training to Diversify your Wealth and Create Passive Compounding in the Markets (click image below for details …)

About Me

Manish Kataria is a Fund Manager. A CFA-qualified professional with 18 years’ experience in investment management and UK property. He has managed investment portfolios for JPMorgan and other blue chip investment houses. Asset classes managed include Equities, ETFs, Bonds, Funds and Options. Within property, he invests in and owns a range of assets including developments, HMOs, BTLs and serviced accommodation. InvestLikeAPro was set up so anyone can invest like a pro.

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