Ndubuisi 'Andy' EgwimMoney Coach for Medics|Ex-NHS GP|21+ Yrs Investor| Founder, MoneyWiseDoctor.com|Helping Medics Avoid Big Money Mistakes

Unlock FREE Money_ ISA vs. Capital Gains Tax Explained!

6 Jul 2026 · 1 min

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In this video, Ndubuisi 'Andy' Egwim explains how UK capital gains tax (CGT) works and why using an Individual Savings Account (ISA) can eliminate that tax. He outlines the CGT rates—18% for basic‑rate taxpayers and 24% for higher‑rate taxpayers—using a simple numeric example (buying a phone for ₦1,000, selling for ₦2,000, resulting in a ₦100 gain and a £240 tax liability). He then shows that gains made inside an ISA are completely tax‑free, emphasizing the massive long‑term savings that can accrue over decades. Andy discusses the annual ISA allowance of £20,000, noting that any unused allowance is lost at the end of the tax year. He describes the three main ISA categories: Cash ISA (for saving), Stocks & Shares ISA (for investing), and Lifetime ISA (for first‑home purchase or retirement), and highlights the government’s 25% bonus on Lifetime ISA contributions up to £4,000. The overall message is that the government offers these tax breaks to encourage saving and investing for retirement, and individuals should maximise their ISA allowance each year to capture free, tax‑efficient growth.

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Normally you would have to pay capital gains tax of 18% if you're a basic rate taxpayer or 24% if you're a higher rate taxpayer. So capital growth is basically, let's say you buy this phone for ₦1,000, you sell it for ₦2,000, you've made a capital gain of ₦100. Now you have to give the government, because they're your partner, you have to give them 24%. That's ₦240. Now, but if you do it inside an ISA, you don't have to pay anything. Imagine when you compound this over 20 years of investing, it could be like hundreds of thousands that you saved from that tax efficiency. So the first thing is allowances. Why would the government give me that tax break? They want me to save. They want you to save. They want you to invest for your retirement. They don't want you to become a liability in the future for them. So I understand that. So I'm going to use up my ISA allowance. It's £20,000 every tax year. At the end of the tax year, it's gone. Bye. If you have not used it, you've lost that year. You start again. So there's a cash ISA, which is basically just for saving. And there's the Stock and Shares ISA, which is for investing, and then the Lifetime ISA, which could be for buying your first home or for retirement. And the government sweetens the deal by adding 25% of whatever you save, up to £4,000.