Tax query on cashing in an investment portfolio

Euro_Skank

Hi,

If I were to sell some of my Hargreaves Lansdown holdings then buy into a Vanguard fund would I have to pay tax on the amount I withdrew from H&L? I'm a resident UK tax payer. 

Cheers! 

dunstonh

Do you hold the fund unwrapped or within a tax wrapper?  (i.e. ISA, pension or bond)

Euro_Skank

Hi,

Thanks for your reply. About a quarter of it is in unwrapped funds / shares. 

eskbanker

Euro_Skank said:

Thanks for your reply. About a quarter of it is in unwrapped funds / shares. 

You're not really giving much away here but if you want to do the maths the test is whether or not you sell unwrapped assets for a gain of more than £12,300 from the acquisition cost, regardless of whether the proceeds stay within the same platform or not.

https://www.gov.uk/capital-gains-tax
https://www.gov.uk/tax-sell-shares

Albermarle

Why not just buy the Vanguard fund on the HL platform ?

Euro_Skank

eskbanker said:

Euro_Skank said:

Thanks for your reply. About a quarter of it is in unwrapped funds / shares. 

You're not really giving much away here but if you want to do the maths the test is whether or not you sell unwrapped assets for a gain of more than £12,300 from the acquisition cost, regardless of whether the proceeds stay within the same platform or not.

https://www.gov.uk/capital-gains-tax
https://www.gov.uk/tax-sell-shares

Thanks, eskbanker! There's no way I will make a profit of £12,300 when I transfer them to Vanguard. Probably not even a tenth of that. 

So that £12,300 you quoted is a seperate cap for investments or does that include other incomes eg property or salary etc? 

Euro_Skank

Albermarle said:

Why not just buy the Vanguard fund on the HL platform ?

Thanks, Albermarle, but I believe HL charge 0.45% as opposed to Vanguard's 0.23% approx for their FTSE Glob All Cap Indx Fnd - Acc. 

Plus, I don't want to hold more than the protected £85K with any one provider. 

Euro_Skank

Deleted_User said:

Albermarle said:

Why not just buy the Vanguard fund on the HL platform ?

Though tax may still be due. It's selling funds that can make you liable for CGT, not then withdrawing the proceeds from the platform.

Thanks. Are they not the same thing?  I thought in order to withdraw your holdings you need to sell them first. 

Albermarle

Euro_Skank said:

Albermarle said:

Why not just buy the Vanguard fund on the HL platform ?

Thanks, Albermarle, but I believe HL charge 0.45% as opposed to Vanguard's 0.23% approx for their FTSE Glob All Cap Indx Fnd - Acc. 

Plus, I don't want to hold more than the protected £85K with any one provider. 

You  seem to be getting the funds and platform fees mixed up.

Normally the funds have the same charge whichever platform you hold them on . So the fund you mention will have the same 0.23% charge on either HL or Vanguard platforms.
Separately there is a platform charge . For HL it is 0.45% and for Vanguard it is 0.15% . So overall holding this fund on the Vanguard platform will be cheaper = 0.38%.

When you are talking about companies like Vanguard or HL , there is no need to worry about the £85K compensation . They are not banks and the chance of them going bust is almost zero . Many people hold hundreds of thousands on one platform with no worries.

eskbanker

Euro_Skank said:

So that £12,300 you quoted is a seperate cap for investments or does that include other incomes eg property or salary etc? 

Capital Gains Tax is separate from Income Tax.

valiant24

Euro_Skank said:

Plus, I don't want to hold more than the protected £85K with any one provider. 

I'd like to be corrected if appropriate.

But my understanding is that the £85k protection relates to any cash you have in the wrapper.

Anything invested in gilts, equities, funds or ETFs will be held separate from the platform's funds and will (should?) not be impacted, even if the platform itself goes bust.