ustee Glossary - T - Tax credit to Trustee

Financial Glossary: T

Tax credit

Dividends payments are received in net because companies are required to deduct tax when paying out a dividend. If your rate of tax is lower than the rate paid by the company, then you are allowed to receive the difference as tax credit.

Tax avoidance

An attempt to minimise the tax payable by legal means.

Tax-efficient investments

Investments that have less of a tax consequence than other investments

Tax evasion

An attempt to minimise the tax payable by illegal means, e.g., by reporting inaccurately.

Tax year

The tax year begins on April 6 and ends on April 5 the following year.

Tender offer

Method of raising capital by inviting investors to make bids for the price they are willing to pay for the shares.

Term insurance

A life insurance policy set up for a specified number of years. If you survive the term of the policy then you do not receive anything. This type of policy is often used to cover long term loans or mortgages. It is the simplest and cheapest form of life insurance.

Tied agent

A tied agent is a financial salesman who can only offer to sell the products of one company, rather than looking at the whole market for products that best suit you.

Total return

The total return on an investment is the combination of both the income return and any capital gain or loss.

Tracker fund

Investment funds that invest in a share portfolio weighted according to the market capitalisation of the various shares in that index, e.g., the FTSE 100. They buy and sell shares according to changes in relative market capitalisation of the companies. These tracker funds thus try to "track" the market rather than beat it.

Transfer value

The value of the pension benefits that you are allowed to take if you decide to leave an occupational pension scheme. The precise value of these benefits will be calcuated by an actuary who works for the pension scheme administrator.

Trustee

An individual or organisation who/that looks after assets for the benefit of another.

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