Capital gains or income tax?

Can you confirm the type of tax liable on investments in the stock ticker (ISIN): IE00B43PVC83 "BlackRock ICS Sterling Government Liquidity Fund". This pays 4-5% "interest" as quoted on the investment platform. So this should seem fairly obviously just income tax. However their documentation, despite saying "interest" everywhere then adds that a "capital growth" is made, only when you "realise" the funds out of this investment and that you should pay the relevant GCT. It would be great to assume this is just invested and grows causing just CGT, as the rates are far lower and even has a tax free threshold. But I suspect this should be treated as income at your own rate. Or, worst case scenario, it's both income taxed and capital gains too! Can you confirm?

Hi
The interst paid on this investment is taxable as income.  
If you dispose of the asset for more that you paid for it, then the difference is capital gains.

Sorry but to completely clarify my understanding, can you confirm this working example? If I pay in funds in May 2023, for example £100,000, every day the platform (Wise) shows a balance increasing by the daily equivalent of 5% annual interest. I then remove the funds in December which are £102,887 (I calculated the twelfth root of 5% for 7mo). This is £2,887 gained "interest" and ALSO a capital gain of £2,887 ? Assuming you've no more capital gains tax free limit left from other investments and are a highest tax bracket earner, this is 45% tax on 2887 and 20% tax on 2887 too, essentially 65% tax?

Hi Damion Yates,
Sorry, we cannot comment on scenarios.
You will need to seek financial advise for an answer to this question.
Thank you.