HMRC view on bond ETFs

Imvrasos

Apologies if it has been discussed already: bond ETFs return capital to investors either by price appreciation, or interest distributions. My understanding is the former falls under CGT, is the latter considered under the standard savings allowance? Therefore for a basic rate taxpayer, bond ETF distributions will use their standard £1000 allowance along with any savings interest.

In addition, what happens with accumulating bond ETFs, would the coupon payments of the underlying bons fall solely under CGT?

Jeremy535897

See https://www.justetf.com/uk/news/passive-investing/how-etfs-are-taxed-in-the-uk.html

Imvrasos

Many thanks, this is quite informative.