james100
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Post by james100 on Apr 4, 2019 16:39:24 GMT
Quick question and please feel free to ignore if too personal...assuming you do Self Assessment (as I guess almost every P2P investor does), and assuming that you've crystallized gains under the annual CGT allowance limit, may I ask what info you send to HMRC to comply with the 4 X allowance reportable proceeds rule (i.e. reporting details to HMRC if your transaction proceeds exceed 46,800 this tax year even if the crystallized gain <11,700)? It has been recently brought to my attention that I may, in fact, be one of very few people who ever observe this rule. And frankly, I'd prefer not to bother to whilst gains are less than my allowance...or at least send them less info if I can get away with it. I'll ask my accountant what to put and where! Last time I had something like this (it was a property gain) I reported very brief details (from memory total received, amount of Primary residence relief, and that the calculated gain was under the annual limit) it in one of the boxes. Thank you! I basically want to avoid offering up a technically correct but unusually complicated S104 holding for discussion...and am under-utilizing my allowance because of this. I'll sleep on it and see how courageous I feel in the morning!
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cwah
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Post by cwah on Apr 4, 2019 21:19:10 GMT
Hello, It's soon the end of the fiscal year. I have a question regarding capital gain tax. We get yearly £11.9k capital gain tax from share increase. I bought some Vanguard S&P500 last year, and made £3k profit. So in order to take advantage of it, do you sell your shares just 1 day before the end of the year? Then buy again few days later on the next fiscal year? So I can accumulate capital gain tax? 30 day rule on buy-back is mentioned hereThat sounds all good. I'll sell my S&P500 tomorrow to pocket my £3k capital gain then buy FTSE100 on Monday Hopefully next year it will top up to £11k capital gain lol
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pom
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Post by pom on Apr 4, 2019 21:53:17 GMT
I've just churned £100K of various predominantly index tracking funds to crystallise £10K of gains Most is in a Cavendish On-line/ Fidelity account with no dealing fees (included within the annual platform fee of 0.25% so no disincentive to move around) Some is in Halifax share dealing account, flat fee of £12.50 per trade (and minimal flat rate annual platform fee of £12.50) None of the funds I invest in have entry/exit fees or bid-offer spread. Total dealing cost was £75 (<0.1%) against a possible tax liability of 20%. Got lucky on the stock market moving the right way during the day or so of dealing delay so actually gained a few hundred overall (though that could have gone the other way of course)! EDIT: cost was of course 0.75% of crystallised gains vs 20% tax - probably a more valid comparison. Quick question and please feel free to ignore if too personal...assuming you do Self Assessment (as I guess almost every P2P investor does), and assuming that you've crystallized gains under the annual CGT allowance limit, may I ask what info you send to HMRC to comply with the 4 X allowance reportable proceeds rule (i.e. reporting details to HMRC if your transaction proceeds exceed 46,800 this tax year even if the crystallized gain <11,700)? It has been recently brought to my attention that I may, in fact, be one of very few people who ever observe this rule. And frankly, I'd prefer not to bother to whilst gains are less than my allowance...or at least send them less info if I can get away with it. My view is just because perhaps a lot of people don't bother - or don't realise they should be reporting it - I'd rather stick to the rules. Mind you I'm generally over the reportable proceeds rule even without considering p2p, and usually have some losses to use as well, so I have even less excuse not to. It helps that most of my p2p transactions (probably) don't count as chargeable assets so it's only ABL (and the occasional bit of property crowdfunding) that I need to worry about.On the down side the amortisations produce a LOT of transactions. I spreadsheet it all to work it all out, but all I actually send them as my "calculation" is a table summarising the number of "disposals" original cost, proceeds, and losses or gain which are then summed for entry into the loss and gain boxes - I print that to pdf and upload. (if they ever want my full spreadsheet they're welcome to request it but 3x so far they haven't). It usually comes out at a pretty pathetic total, and so far I've only once had to pay a smidgen of CGT, but never mind.
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hazellend
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Post by hazellend on Apr 19, 2019 12:09:47 GMT
Also you can transfer assets between spouses to utilise their capital gains allowance as well.
I’ve done this with Hargreaves Lansdown and they charged something like £12 to transfer between taxable accounts.
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hazellend
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Post by hazellend on Apr 19, 2019 12:11:48 GMT
Quick question and please feel free to ignore if too personal...assuming you do Self Assessment (as I guess almost every P2P investor does), and assuming that you've crystallized gains under the annual CGT allowance limit, may I ask what info you send to HMRC to comply with the 4 X allowance reportable proceeds rule (i.e. reporting details to HMRC if your transaction proceeds exceed 46,800 this tax year even if the crystallized gain <11,700)? It has been recently brought to my attention that I may, in fact, be one of very few people who ever observe this rule. And frankly, I'd prefer not to bother to whilst gains are less than my allowance...or at least send them less info if I can get away with it. My view is just because perhaps a lot of people don't bother - or don't realise they should be reporting it - I'd rather stick to the rules. Mind you I'm generally over the reportable proceeds rule even without considering p2p, and usually have some losses to use as well, so I have even less excuse not to. It helps that most of my p2p transactions (probably) don't count as chargeable assets so it's only ABL (and the occasional bit of property crowdfunding) that I need to worry about.On the down side the amortisations produce a LOT of transactions. I spreadsheet it all to work it all out, but all I actually send them as my "calculation" is a table summarising the number of "disposals" original cost, proceeds, and losses or gain which are then summed for entry into the loss and gain boxes - I print that to pdf and upload. (if they ever want my full spreadsheet they're welcome to request it but 3x so far they haven't). It usually comes out at a pretty pathetic total, and so far I've only once had to pay a smidgen of CGT, but never mind. I just use ABL rates tax statement for my figures. What’s the problem with the amortising loans from a tax perspective?
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pom
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Post by pom on Apr 19, 2019 16:51:11 GMT
My view is just because perhaps a lot of people don't bother - or don't realise they should be reporting it - I'd rather stick to the rules. Mind you I'm generally over the reportable proceeds rule even without considering p2p, and usually have some losses to use as well, so I have even less excuse not to. It helps that most of my p2p transactions (probably) don't count as chargeable assets so it's only ABL (and the occasional bit of property crowdfunding) that I need to worry about.On the down side the amortisations produce a LOT of transactions. I spreadsheet it all to work it all out, but all I actually send them as my "calculation" is a table summarising the number of "disposals" original cost, proceeds, and losses or gain which are then summed for entry into the loss and gain boxes - I print that to pdf and upload. (if they ever want my full spreadsheet they're welcome to request it but 3x so far they haven't). It usually comes out at a pretty pathetic total, and so far I've only once had to pay a smidgen of CGT, but never mind. I just use ABL rates tax statement for my figures. What’s the problem with the amortising loans from a tax perspective? Well we were talking about CGT which ABL don't produce reports for....and if you're sure you don't need to worry about reporting capital gains then absolutely nothing. www.ablrate.com/faq/what-is-the-tax-position/An accountant might be able to argue for you that they've got it wrong - in my case I don't feel the need for one generally so it's cheaper to accept a small tax liability. But basically... all loans are eligible for CGT reporting if you're over either of the thresholds (gains over CGT allowance, or total TRANSACTIONS over 4xCGT allowance), and since Instant Returns=discount on price then even if you never use the SM at all, every single time a loan repays capital - either at end term or an amortising repayment there will be a (small) capital gain. So for every amortising loan you'll have 12 disposals per year even if no SM transactions, which rapidly ends up to big complicated spreadsheets. And if you do use the SM you might think you're making a loss but could still be making a gain if the loan took a while to fill. As for when a loan that had instant returns on defaults - hasn't happened yet as the containers didn't pay any - my best guess currently is we may be in the weird situation of having to declare a gain at the same time as offsetting the loss against IT...or something And it's surprising how much the transactions add up, even if you're nowhere near the thresholds for paying CGT, especially if you move a lot of loans into your ISA. Anyone that's also crystallised a lot of PM investments this year (whether leaving or staying) for example may well be in the situation this year where they should also report ABL transactions, even if they won't owe any tax...
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bigfoot12
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Post by bigfoot12 on Apr 19, 2019 17:49:01 GMT
Quick question and please feel free to ignore if too personal...assuming you do Self Assessment (as I guess almost every P2P investor does), and assuming that you've crystallized gains under the annual CGT allowance limit, may I ask what info you send to HMRC to comply with the 4 X allowance reportable proceeds rule (i.e. reporting details to HMRC if your transaction proceeds exceed 46,800 this tax year even if the crystallized gain <11,700)? The spreadsheet I use to calculate my capital gains and losses has another page formatted so that I can save as PDF and then attach it to my Self Assessment. Sorting this out takes me an extra 5 minutes per year.
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cwah
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Post by cwah on Apr 22, 2019 21:12:40 GMT
Is the income coming from loan interest treated as capital gain? I thought it would be treated as income?
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james100
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Post by james100 on Apr 23, 2019 6:57:13 GMT
Is the income coming from loan interest treated as capital gain? I thought it would be treated as income? No. Interest is income. The CG reporting/taxation liability point relates to the repayments of capital with the relevant acquisition/disposal costs based on the net of instant return from primary market acquisition + any applicable premium / discount from secondary market acquisition or disposal (with gains/losses calculated per amortizing loan repayment as per an s104 pool holding assuming sale at par until/unless a SM disposal at non-par alters that sale value figure which would then be recouped/repaid in tax year of disposal). pom explains it much better than I can. I've previously attempted to create a little program to automatically calculate this from a historical transactions download and got stuck due to ablrate's loan titling conventions but will revisit later this year.
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