The Gilt Book — How to Buy a Gilt

01 —— How to Buy a Gilt — Step by Step

Understand what you're buying

A gilt is a UK government bond — essentially a loan to HM Treasury. You receive a fixed coupon (interest) twice a year, and your £100 par value is returned on the redemption date. Low-coupon gilts purchased below par generate a capital gain on maturity which is entirely free of Capital Gains Tax.

💡 The lower the coupon, the greater the tax-free element of your return.

Choose your gilt

Use our Gilt Book to find the right gilt for your investment horizon. Key things to consider: maturity date (when you get your money back), coupon rate (lower = more tax-efficient), and current price (buying below £100 gives you a tax-free gain). Our calculator shows your after-tax return based on your tax band.

💡 Use the "Choose Your Gilt" section below to filter by your investment horizon.

Open a brokerage account

You'll need a UK stockbroker account to buy gilts. Most can be opened online in under 10 minutes with your National Insurance number and bank details. For maximum tax efficiency, consider holding gilts inside an ISA (shelters coupon income) or a SIPP (pension). Outside a wrapper, only the coupon is taxable — capital gains remain exempt regardless.

💡 Gilts can be held in a Stocks & Shares ISA — compare brokers below for ISA fees.

Place your order

Search for your chosen gilt by ISIN code or ticker (e.g. TG35, GB00BMGR2916). Gilts trade in the secondary market and prices fluctuate throughout the day. You can place a market order (buy at current price) or a limit order (set your maximum price). The minimum trade size is typically £1,000 nominal with most brokers.

💡 Always check the "clean price" vs "dirty price" — you may pay accrued interest on top.

Hold to maturity & collect your gain

Once purchased, simply hold your gilt until redemption. HM Treasury will automatically redeem at £100 par value on the maturity date, and the difference between your purchase price and £100 is your tax-free capital gain. Coupons are paid directly into your brokerage account twice yearly.

💡 You can also sell before maturity on the secondary market, though prices may be higher or lower than par.

Why gilts are CGT-exempt

Under UK law, gilts (and most UK government securities) are exempt from Capital Gains Tax regardless of the gain made. This is enshrined in TCGA 1992, s.115. Only the coupon income is subject to Income Tax. For a 45% additional-rate taxpayer buying a gilt at £60 and redeeming at £100, the £40 gain is entirely tax-free. This is not a loophole — it is explicit government policy to keep borrowing costs low.

02 —— Choose Your Gilt

Select your investment horizon and we'll match you to the most suitable gilts.

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Ultra-Short

Under 2 years

Capital preservation. Near-cash equivalent. Minimal price volatility.

📅

Short

2 – 5 years

Balance of return and flexibility. Popular with ISA investors.

📈

Medium

5 – 10 years

Higher tax-free capital gain. Good for higher-rate taxpayers.

🏛️

Long

10 – 25 years

Maximum CGT-free gain. Significant discount to par. Pension planning.

🔭

Very Long

25 years+

Deepest discount gilts. Highest capital gain potential. For patient investors.

03 —— Where to Buy Gilts

UK gilts can be purchased through any FCA-regulated stockbroker or investment platform that offers access to the London Stock Exchange bond market. Most major platforms — including Hargreaves Lansdown, AJ Bell, Interactive Investor, Fidelity and Interactive Brokers — allow gilt purchases within ISA, SIPP, or general investment accounts.

When selecting a broker, compare their gilt trading fees (typically £3–£12 per trade), platform fees (custody charges, if any), and account types available (ISA vs SIPP vs unwrapped). The minimum trade size is usually £1,000 nominal.

The Gilt Book broker comparison tool is coming soon. We're currently in discussions with UK platforms to bring you direct comparison and streamlined account opening. Check back shortly.