Financial Glossary
Key terms explained in plain English, no jargon, no complexity. We appreciate our industry uses a lot of financial ‘jargon’, which can make it difficult to decipher information and correspondence. In order to try to assist with this, we have created a glossary of many of the terms you may come across. If you would like further clarification on any of the definitions, or cannot find a particular term, we would be happy to assist further.
PAYE (Pay As You Earn)
HM Revenue & Customs’ system for collecting income tax from the pay of employees as they earn it.
Potentially Exempt Transfer
Gifts on which inheritance tax will not be payable unless the donor dies within seven years.
Personal Allowance
The Personal Allowance is the amount of income you can earn before paying tax.
Power of Attorney
A legal document authorising a named person to make decisions on your behalf. A Lasting Power of Attorney (LPA) remains valid should you lose mental capacity, making it an important element of long-term financial planning.
Portfolio Rebalancing
The process of realigning a portfolio's asset allocation back to its target, typically by selling over-performing assets and buying under-performing ones. Rebalancing maintains the intended risk profile as markets move.