Glossary of UK personal-finance acronyms

Every initialism we use across the site, in plain English. Hover any acronym in an article body to see the short version of these definitions inline.

A

AEA(Annual Exempt Amount)
The Annual Exempt Amount is the slice of capital gains you can realise in a tax year before any Capital Gains Tax is owed. HMRC has cut it from £12,300 (2022/23) to £3,000 (2024/25 onwards). Read more →
APR(Annual Percentage Rate)
The total cost of borrowing expressed as a yearly percentage, including interest and most mandatory fees. UK lenders are required to quote APR on consumer credit.
AUM(Assets Under Management)
The total market value of investments a fund manager, platform, or wealth manager runs on behalf of clients. A rough proxy for scale.

B

BNPL(Buy Now, Pay Later)
Short-term consumer credit, typically interest-free if paid on schedule, offered at checkout by Klarna, Clearpay, PayPal Pay in 3 and others. FCA-regulated from 2026. Read more →
BoE(Bank of England)
The UK central bank. Sets the Bank Rate, supervises banks, issues sterling, and runs monetary policy through the Monetary Policy Committee. Read more →
BTL(Buy-to-Let)
A residential property bought primarily to rent out rather than live in. Has its own mortgage rules, tax regime (Section 24), and SDLT surcharge. Read more →

C

CFD(Contract for Difference)
A leveraged derivative letting you bet on price moves without owning the underlying asset. The FCA discloses that around 70-80% of retail CFD accounts lose money. Read more →
CGT(Capital Gains Tax)
Tax on the profit when you sell an asset (shares, property other than your main home, crypto). The 2026/27 Annual Exempt Amount is £3,000; rates are 18% or 24% on residential property, 10% or 20% on other gains. Read more →
CPI(Consumer Prices Index)
The Consumer Prices Index. The headline UK inflation measure published monthly by ONS and the target the Bank of England aims at (2%).
CRA(Credit Reference Agency)
A Credit Reference Agency. The three UK agencies are Experian, Equifax and TransUnion. They hold the data lenders pull to compute your credit score. Read more →

D

DMP(Debt Management Plan)
A Debt Management Plan. An informal arrangement, typically run by a free charity (StepChange, National Debtline), where you pay creditors a reduced monthly amount over an extended period. Read more →
DRO(Debt Relief Order)
A Debt Relief Order. A formal UK insolvency option for people with low income, few assets and debts under £50,000 (2024 threshold). Debts are written off after a 12-month moratorium. Read more →

E

EIS(Enterprise Investment Scheme)
The Enterprise Investment Scheme. UK tax relief of 30% income tax on investments up to £1m a year into qualifying early-stage companies, with CGT exemption after three years. Read more →
ERI(Excess Reportable Income)
Excess Reportable Income. The annual taxable amount HMRC treats as a deemed distribution for accumulating offshore funds held outside a wrapper. You owe tax on it even though no cash is paid.
ETF(Exchange Traded Fund)
An Exchange Traded Fund. A fund that holds a basket of assets and trades on a stock exchange like a single share. Most UK retail ETFs are UCITS-compliant and Irish-domiciled. Read more →

F

FCA(Financial Conduct Authority)
The Financial Conduct Authority. UK regulator for financial services firms, including banks, brokers, advisers, insurers and payment firms. Sets conduct rules and authorises firms.
FI(Financial Independence)
Financial Independence. The point where investment income covers your annual spending. Commonly defined as 25x annual expenses invested (the inverse of the 4% Safe Withdrawal Rate). Read more →
FIRE(Financial Independence, Retire Early)
Financial Independence, Retire Early. A movement around saving aggressively (often 50%+ of income) to reach FI well before traditional retirement age. Read more →
FOS(Financial Ombudsman Service)
The Financial Ombudsman Service. The free dispute resolution service for consumer complaints about FCA-authorised firms. Can award up to £430,000 per complaint (2024 limit).
FSCS(Financial Services Compensation Scheme)
The Financial Services Compensation Scheme. Pays out if an authorised UK firm fails - £85,000 per person per bank for deposits, £85,000 per person per firm for most investments. Read more →
FTSE(Financial Times Stock Exchange)
Financial Times Stock Exchange. The index family run by FTSE Russell. The FTSE 100 tracks the 100 largest UK-listed companies; FTSE All-World is a popular global benchmark. Read more →

G

GDP(Gross Domestic Product)
Gross Domestic Product. The total monetary value of all goods and services produced in a country in a year. GDP per capita is the more relevant number for living standards. Read more →
GIA(General Investment Account)
A General Investment Account. A plain brokerage account with no tax wrapper. CGT, dividend tax and income tax all apply. Used once ISA and pension allowances are exhausted. Read more →

H

HICBC(High Income Child Benefit Charge)
The High Income Child Benefit Charge. A tax charge that claws back Child Benefit when one earner has Adjusted Net Income above £60,000 (2026/27 threshold). Read more →
HMRC(His Majesty Revenue and Customs)
His Majesty's Revenue and Customs. The UK tax authority. Collects income tax, NI, VAT, CGT, IHT, SDLT and runs Self Assessment, PAYE and tax credits.

I

IFA(Independent Financial Adviser)
An Independent Financial Adviser. A regulated adviser able to recommend products across the whole market, paid by an agreed fee rather than by product commission. Read more →
IFISA(Innovative Finance ISA)
The Innovative Finance ISA. A tax wrapper for peer-to-peer lending and crowdfunded debt investments. Same £20,000 ISA allowance, but no FSCS protection on the underlying loans. Read more →
IHT(Inheritance Tax)
Inheritance Tax. Tax on the value of an estate above the £325,000 nil-rate band (plus £175,000 residence nil-rate band where applicable). The headline rate is 40%. Read more →
IR35(Off-payroll working rules)
Off-payroll working rules. HMRC anti-avoidance regime catching contractors who would be employees but for their personal service company. Status now determined by the end client for most engagements. Read more →
ISA(Individual Savings Account)
An Individual Savings Account. The UK tax wrapper letting you save and invest £20,000 a year (2026/27) entirely tax-free on interest, dividends and capital gains. Cash, Stocks & Shares, LISA, IFISA and JISA flavours exist. Read more →
IVA(Individual Voluntary Arrangement)
An Individual Voluntary Arrangement. A formal court-approved agreement to repay creditors a portion of debt over a fixed period (typically 5-6 years). Less drastic than bankruptcy but still a major credit-file event. Read more →

J

JISA(Junior ISA)
A Junior ISA. A tax-free wrapper for under-18s with a £9,000 annual allowance (2026/27). Cash and Stocks & Shares variants exist; the money locks in until the child turns 18. Read more →

L

LISA(Lifetime ISA)
A Lifetime ISA. £4,000 annual subscription with a 25% government bonus, usable for a first home (up to £450,000) or from age 60. Penalty applies for other withdrawals. Read more →
LTV(Loan-to-Value)
Loan-to-Value. The mortgage as a percentage of the property value. Lower LTV typically unlocks better mortgage rates - the cliff edges sit at 75%, 80%, 85%, 90% and 95%.

M

MPC(Monetary Policy Committee)
The Monetary Policy Committee. The nine-member Bank of England committee that sets UK Bank Rate, voting eight times a year.

N

NAV(Net Asset Value)
Net Asset Value. The per-share value of a fund's holdings, calculated by dividing total assets minus liabilities by the number of shares outstanding.
NI(National Insurance)
National Insurance. UK social-security contributions paid by employees, employers and the self-employed. Funds the State Pension, NHS and contributory benefits.
NIC(National Insurance Contributions)
National Insurance Contributions. The technical term for NI payments. Class 1 (employees), Class 2 (self-employed flat rate, abolished 2024), Class 3 (voluntary) and Class 4 (self-employed profits).
NS&I(National Savings & Investments)
National Savings & Investments. UK Treasury-backed savings provider. 100% capital guarantee (not capped at the FSCS limit) on Premium Bonds, Income Bonds, Direct Saver and other products. Read more →
NSI(National Savings & Investments)
Variant spelling of NS&I. Same provider, same Treasury backing. Read more →

O

OBR(Office for Budget Responsibility)
The Office for Budget Responsibility. Independent body that produces the official UK economic and fiscal forecasts that frame each Budget and Spring Statement.
OCF(Ongoing Charges Figure)
The Ongoing Charges Figure. The standardised annual fee on a UCITS fund, expressed as a percentage of assets. Replaced the older TER. Includes management and admin costs, excludes one-off entry/exit and internal trading costs.
OEIC(Open-Ended Investment Company)
An Open-Ended Investment Company. The UK fund structure that issues and redeems shares directly with investors at NAV. The dominant fund vehicle for UK-domiciled funds.
ONS(Office for National Statistics)
The Office for National Statistics. The UK government statistics agency. Publishes CPI, GDP, wages, productivity, the Wealth and Assets Survey and most other headline economic data.

P

PAYE(Pay As You Earn)
Pay As You Earn. The system that deducts income tax and NI directly from your salary before it reaches your bank account. Run by the employer on HMRC's behalf.
PRA(Prudential Regulation Authority)
The Prudential Regulation Authority. The Bank of England arm that supervises banks, building societies and insurers for prudential safety. Sits alongside the FCA.
PSA(Personal Savings Allowance)
The Personal Savings Allowance. The tax-free slice of savings interest: £1,000 for basic-rate taxpayers, £500 for higher-rate, £0 for additional-rate.

R

REIT(Real Estate Investment Trust)
A Real Estate Investment Trust. A listed company that owns income-producing property and is exempt from corporation tax on rental profits, provided it distributes 90%+ of those profits. Read more →
ROI(Return on Investment)
Return on Investment. The percentage gain (or loss) on the capital invested in something. A general-purpose, unstandardised measure.

S

SDLT(Stamp Duty Land Tax)
Stamp Duty Land Tax. The progressive tax on residential property purchases in England and Northern Ireland (Scotland and Wales have their own equivalents). Read more →
SEIS(Seed Enterprise Investment Scheme)
The Seed Enterprise Investment Scheme. UK tax relief of 50% income tax on investments up to £200,000 a year into very-early-stage qualifying companies, with CGT exemption after three years. Read more →
SIPP(Self-Invested Personal Pension)
A Self-Invested Personal Pension. A personal pension wrapper that lets you choose your own investments. Same tax relief rules as any pension; the £60,000 annual allowance (2026/27) applies. Read more →
SWR(Safe Withdrawal Rate)
The Safe Withdrawal Rate. The percentage of a retirement pot you can withdraw each year, inflation-adjusted, without running out over a target horizon. The classic Bengen figure is 4%. Read more →

T

TER(Total Expense Ratio)
Total Expense Ratio. The older name for what is now called OCF on UCITS funds. Many providers still use the two terms interchangeably.

U

UCITS(Undertakings for Collective Investment in Transferable Securities)
Undertakings for Collective Investment in Transferable Securities. The EU regulatory regime that the UK still recognises. UCITS funds enforce diversification, liquidity and disclosure rules that make them retail-suitable across Europe. Read more →

V

VCT(Venture Capital Trust)
A Venture Capital Trust. A listed fund that invests in early-stage UK companies. Offers 30% income tax relief on subscriptions up to £200,000 a year, plus tax-free dividends and gains. Read more →