The Number That Shocked Every Doctor — £56,000 to HMRC Before Touching a Penny
In this segment, Andy Egwim contrasts the long‑term cost of a passive investment ISA (represented by "Gloria") with the tax and effort burden of a buy‑to‑let property (represented by "Bayo"). He notes that the total expense ratio (TER) on Gloria’s passive fund over 25 years amounts to roughly £25,000, while Bayo pays a one‑off capital gains tax (CGT) of £56,145 to HMRC before he can access any proceeds. Andy then lines up the two exits: Gloria’s ISA grows to £640,000 with zero tax, giving her the full amount, whereas Bayo’s property sells for a gross £337,000, leaves him with £280,795 after CGT, plus about $132,000 in accumulated rent, totaling roughly $315,000. He emphasizes that despite Bayo’s effort and additional income, his net wealth is less than half of Gloria’s passive return, highlighting how fees, taxes, and active management can erode investment outcomes.
