Investment management - Christmas Edition

Thrugelmir

RobHT said:

Thrugelmir said:

eskbanker said:

RobHT said:

Looking here, it makes me think to trash the idea of dividents, too complex: https://transferwise.com/gb/blog/uk-tax-on-foreign-dividends 

Unless I invest only in dividents in UK, but that would be very silly...

Don't look there, it's an old article referring to changes in dividend taxation back in 2009, although a newer date seems to have been attached at the top for some reason.  Foreign Tax Credit Relief is generally available for most countries, via which you can offset your non-UK taxation on foreign dividends against your UK tax liabilities for those, so the net effect should be that foreign dividends aren't penalised as heavily as you seem to think, if at all, and certainly not at a fixed rate of 10% as suggested by that old article from back when there were tax credits applied to UK dividends.

If held within an ISA or a SIPP recovery of "dividend" tax levied on foreign owned shares can be a challenging exercise. 

Why an ISA should be in this speech?
Are you talking about in case of moving funds in/out an ISA? (dividends gain involved)

 The shares are held on a nominee rather than individual basis. Making proof of ownership somewhat difficult. When attempting to recover (sometimes sizable)  tax deductions on shares owned in European companies. 

RobHT

NottinghamKnight said:

RobHT said:

eskbanker said:

RobHT said:

eskbanker said:

RobHT said:

Looking here, it makes me think to trash the idea of dividents, too complex: https://transferwise.com/gb/blog/uk-tax-on-foreign-dividends 

Unless I invest only in dividents in UK, but that would be very silly...

Don't look there, it's an old article referring to changes in dividend taxation back in 2009, although a newer date seems to have been attached at the top for some reason.  Foreign Tax Credit Relief is generally available for most countries, via which you can offset your non-UK taxation on foreign dividends against your UK tax liabilities for those, so the net effect should be that foreign dividends aren't penalised as heavily as you seem to think, if at all, and certainly not at a fixed rate of 10% as suggested by that old article from back when there were tax credits applied to UK dividends.

And, by the way, the word is 'dividend', with a D, or rather three of them....

Thanks, but it seems a complex and long procedure to do something easy , I'm glad this year I don't need to do it, at least for dividends, let's see how it goes with options trading and therefore CGT

Your choice, I'm not trying to push you one way or the other - my initial point was simply to observe that if you're weighing up income versus growth alternatives, it obviously makes sense to do so armed with as many pertinent facts as possible, rather than making false assumptions or misunderstanding how taxation works.  As soon as you're outside tax shelters, you have to maintain good records of all your transactions and take responsibility for establishing tax liabilities, whether that's income tax or CGT, so best not be under any illusion that there's minimal work involved in running a sizable unwrapped portfolio!

Thanks, but I would pay a tax accountant, I can't really find the time to do that task alone, and taking also full responsability on it. It's not really my field and it seems a waste of time, I only hope that the tax accountant won't be greedy  

But the majority of the work is in keeping good records which you'll have to do anyway or the tax accountant won't have anything to work with. 

I understand that, but I make too many trades, therefore the platform should provide me the documents I need...
If not, it will be impossible for me to track down all as the government expects, moreover because I'm not a tax accountant...
For this year I don't think I need to take care of these things unless I sell my successful gains, I'll start to have a look as soon as I can, but I wonder where  

RobHT

Thrugelmir said:

RobHT said:

Thrugelmir said:

eskbanker said:

RobHT said:

Looking here, it makes me think to trash the idea of dividents, too complex: https://transferwise.com/gb/blog/uk-tax-on-foreign-dividends 

Unless I invest only in dividents in UK, but that would be very silly...

Don't look there, it's an old article referring to changes in dividend taxation back in 2009, although a newer date seems to have been attached at the top for some reason.  Foreign Tax Credit Relief is generally available for most countries, via which you can offset your non-UK taxation on foreign dividends against your UK tax liabilities for those, so the net effect should be that foreign dividends aren't penalised as heavily as you seem to think, if at all, and certainly not at a fixed rate of 10% as suggested by that old article from back when there were tax credits applied to UK dividends.

If held within an ISA or a SIPP recovery of "dividend" tax levied on foreign owned shares can be a challenging exercise. 

Why an ISA should be in this speech?
Are you talking about in case of moving funds in/out an ISA? (dividends gain involved)

 The shares are held on a nominee rather than individual basis. Making proof of ownership somewhat difficult. When attempting to recover (sometimes sizable)  tax deductions on shares owned in European companies. 

I own these shares, not my partner in a joint account, or probably you have meant that it looks like the platform owns them from outside...
Not really sure what do you mean here.

For example, in a fund or ETF for dividends income, it's gonna be almost impsosible to track down foreign investments and local and give all clear to the tax office, the platform should provide these info...

RobHT

I think I didn't disclose another part of the plan.

In my current ISA I've done few swing trades, in fact the balance is higher than 20k.

What I'm trying to do inside the ISA is to maximize profits, regarding to load up the balance I need to wait anyway due to the 20k annual limit...

Once I've reached a nice sum, probably 100k, I'll put everything on a fund for income, and I'll invest everything I get back for years, till I don't reach a nice income, let's say 10 years plan.

But again, I'd invest only when I feel is the right moment, or I may miss a lot of gains...

BUT.......

Seen that profits can be reinvested for free in an ISA and it doesn't consider the 20k ISA limits, I think is much better to put everything on a divident fund from now.

Let me explain.

Seen that I'm able to maximize my ISA and all is tax free, it's convenient to put all in a divident ETF or fund and invest every month, in the end of the year I would be able to actually invest more than 20k in the ISA, and it will be always in this way in the future (if my income permits).

Not sure if HL will make me pay the transaction, I remember that ETFs and funds are free, but probably only if you invest regularly with a direct debit, I need to check, or the fees will eat up my wallet.

Outside the ISA instead, I play with penny stocks and exponential growth stocks like AMD etc, basically the risky part of the story plus option trading.

I consider this worth only if the fund/ETF is able to give me 5% as minimum, below it doesn't make much sense... I was looking fidelity fund: https://www.hl.co.uk/funds/fund-discounts,-prices--and--factsheets/search-results/f/fidelity-moneybuilder-dividend-income-inclusive 

For my understanding it costs 1.17% plus dealing charges... Honestly if I load up every 6 months aprox is not a big problem, different is if I invest every month but that shouldn't be paid 12 pounds per transaction, but at that point is better to combine a fund for growth and income due to the multiple transactions per year not in the best moments.

This dividend fund has 80% exposure in UK, but for who invests for income I think that's mandatory in their country of residence...

Do you know any better?

What do you think?

bowlhead99

RobHT said:

Do you know any better?

What do you think?

I think having previously been involved in your threads I may know better but not know how to communicate it effectively to you, so I am just staying out of this one.  Good luck.

Old_Lifer

I am finding this thread more than a bit confusing and something of a merry-go-round   but perhaps it is just me.

Alexland

I struggle with this thread too. Without wanting to offend RobHT, it's great he's interested and has ambition, but there is a contradiction between telling us that by taking crazy risks he can retire at 35 but at the same time us asking us about the basics.

barnstar2077

As bowlhead99 alludes, if you read some of RobHT's previous threads you will see that they all follow a similar pattern.

RobHT

barnstar2077 said:

As bowlhead99 alludes, if you read some of RobHT's previous threads you will see that they all follow a similar pattern.

So help me to break my pattern then  

RobHT

Alexland said:

I struggle with this thread too. Without wanting to offend RobHT, it's great he's interested and has ambition, but there is a contradiction between telling us that by taking crazy risks he can retire at 35 but at the same time us asking us about the basics.

What basics? I didn't say I'm expert, I'm here to find my way