Treasury Bills

[Alaric]

ii and no doubt others were offering an IPO on Treasury Bills

Specifically
3 Months UK Treasury Bill Maturing on 30-Sep-2024
and
6 Months UK Treasury Bill Maturing on 30-Dec-2024

They must have been popular since the offers are now closed.

The return on these is that the maturity value is greater than the issue price, which is set by auction.

It appears they would fall under the rules for "deeply discounted securities" rather than Gilts. Thus the return would be taxed as income.
https://www.gov.uk/hmrc-internal-manual ... l/saim3010

[Padders72]

ii offer Treasuries around once a month and also gilt IPOs too occasionally. Not every release but a selection. They close usually a couple of days before the auction so I don’t think they closed early due to over subscription necessarily. The most recent deadline was 1.30pm on the 27th. At 5.2% they offer a nice alternative to bank accounts I guess but as you say there are no tax benefits. I doubt one can easily find 5.2% over just 3 months anywhere else at present so as bank interest rates fall they are becoming interesting as an alternative.

Freetrade offer access to all treasury releases I believe as a sort of quasi rolling bank account.

[Alaric]

I doubt one can easily find 5.2% over just 3 months anywhere else at present so as bank interest rates fall they are becoming interesting as an alternative.

I think you don't actually know you are getting 5.2% until the auction. With all ISAs now under the same rules, it's perhaps best considered against Cash ISAs. The prospectus said they aren't traded on a market. Is there a mechanism to get the money out before maturity, even at a loss?

[Padders72]

I doubt one can easily find 5.2% over just 3 months anywhere else at present so as bank interest rates fall they are becoming interesting as an alternative.

I think you don't actually know you are getting 5.2% until the auction. With all ISAs now under the same rules, it's perhaps best considered against Cash ISAs. The prospectus said they aren't traded on a market. Is there a mechanism to get the money out before maturity, even at a loss?

Last week's auction achieved 5.2%. I'd be surprised if this week's got less, or much more for that matter, but I see your point, these things are pretty predictable and track interest rates pretty closely so look at changes there. Nothing is set in stone it's true. No there is no easy way to get your money out as they don't trade in a liquid fashion it seems, but with a 3 month duration at the short end that isn't a massive hurdle. If I were parking a chunk of cash I knew I didn't need for 3-6 months, I'd certainly consider these vs a lower return in a savings account. The default risk is about the same but with no £85K limit.