Stockbrokers explained Share dealing with stockbrokers

Online share dealing

Online share dealing is faster and cheaper

You can instruct your stockbroker to deal shares online, over the phone or by post, depending on the service they offer.

Once you’ve paid money into your account, you can start dealing. Using an online service means you can make trades immediately within the London Stock Exchange trading hours of 8am to 4.30pm, Monday to Friday.

The methods you use to contact your stockbroker will affect the charges you pay. Your instructions will usually be carried out as soon as your broker receives them if it’s within trading hours or, if not, on the next day of trading – but the price could change by the time the trade is made.

Make sure you're aware of the different types of stockbroker services that are available before you part with your savings.   

Relatively low rates of interest compared with conventional savings accounts (if any) tend to be paid on any cash left in your account, depending on the broker and amount, so you should avoid keeping money in it if you don’t need to.


Share dividends – the regular income from your investments – can be paid as cash into your stockbroking account or nominated bank account, or reinvested.

Stamp duty reserve tax

You pay stamp duty reserve tax at 0.5% when you buy UK shares electronically. Stamp duty – also at 0.5% – is payable when you buy through a paper transaction, but the amount is rounded up to the nearest £5 and you don’t have to pay anything if the shares cost £1,000 or less.

You may have to pay capital gains tax on any profits above a certain level when you sell shares (£11,000 for 2014-15).

Protection should things go wrong 

All UK stockbrokers must be regulated by the Financial Conduct Authority (FCA), so are members of the Financial Services Compensation Scheme. This means you can get compensation of up to £50,000 if your broker goes bust owing you money and/or shares.

Assets held in a nominee account should be ring-fenced so are not considered part of the stockbroker’s assets if it goes bust. Check with your broker to make sure that this is the case.

Beware of firms that cold call you to sell shares, even if they claim to be FCA-authorised. They could be carrying out ‘boiler room’ scams and take your money in exchange for worthless shares.

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Last updated:

April 2016

Updated by:

Michael Trudeau

Which? Limited (registered in England and Wales number 00677665) is an Introducer Appointed Representative of Which? Financial Services Limited (registered in England and Wales number 07239342). Which? Financial Services Limited is authorised and regulated by the Financial Conduct Authority (FRN 527029). Which? Mortgage Advisers and Which? Money Compare are trading names of Which? Financial Services Limited. Registered office: 2 Marylebone Road, London NW1 4DF.