The first tax you will incur when trading on Freetrade is the 0.5% stamp duty (reserve tax), which applies to all UK-listed stocks traded electronically. It is paid at the point of purchase and applied to the total transaction cost. Capital gains tax (CTG) is the second tax you pay when trading on Freetrade. You pay it when you realize gains from selling stocks or ETFs. The dividends you receive are taxed as income and not as capital gains. You can avoid paying taxes by opening an ISA account. For every tax year, the maximum amount you can add to your stock and share ISA account is £20,000. All the returns you get from this account are not taxed. Dividends paid are also tax-immune.