Please note
Tax treatment depends on your individual circumstances and may be subject to change in the future. This summary is provided for informational purposes only and relates to the position of a UK resident individual taxpayer. We do not offer advice on tax and if you are in doubt about your own position you should seek professional advice.

Your investment return on Abundance is split into three parts:

For the majority of the investments on Abundance the investment income is treated as interest from a tax perspective. This is the case for all investment types on Abundance except variable return investments. Your Cash Return will therefore be taxed according to your income tax band and should be declared on your tax return.

For some of the investments on Abundance, the company or council issuing the investment is required to deduct a proportion of your interest payments, equivalent to the basic rate of income tax (currently 20%), and pay this to HMRC directly. Please see our Help Centre article on Withholding Tax for more information.

With a variable return investment, your income will be taxed in the same way as a dividend on a share. This is because the size of your investment income is linked to how the underlying project performs. The dividend tax rate will depend on whether you are a non-taxpayer, basic rate, higher rate or additional rate taxpayer. You may have a dividend tax-free allowance also.

You have a £1,000 (or £500 for higher rate taxpayers) tax free interest allowance. Additional rate taxpayers are not entitled to the personal savings allowance. This means the first £1,000 (£500 for higher rate taxpayers) of interest income will be free of income tax (but please see our article on Withholding Tax for information of when tax may be deducted from your returns). All investments on Abundance except variable return investments pay returns that are treated as interest.

Since the 2016/2017 tax year, you have a tax-free dividend allowance, although the amount has been decreasing. Variable return investments pay returns that are treated as dividends.

If you're completing your tax return, you can find a breakdown of what you have earned on Abundance in a particular tax year. If you did not earn a return on Abundance in a tax year, that year won't appear as an option.

To view the tax section, click Manage in the menu at the top of the page when signed in to your account and then select Tax in the Money section. You'll also find the option to download a statement as a PDF.

Please note, the Tax section is only available in your Standard portfolio and not your IF ISA or SIPP portfolio (as returns are tax free in these portfolios).

The position of companies, partnerships, trusts or unincorporated associations is complex and investors in these categories should get appropriate tax advice on their position. As a general rule, UK companies will pay corporation tax on their investment income and on capital gains.