Evidence of Capital Gain/Loss - IFA or Accountant ?

Hargel112

For some years I've been using an IFA to build up ISA, Pension and general investment savings via a third party platform. The death of my parents and sale of the family home led to me adding a lump sum, which means I am now having to track CGT each year.  My IFA has told me I made a reportable loss for the year 2022/23 but is unable to provide summary evidence of it that I can send to HMRC. They have just sent me 16 years of transaction data on Excel.  I contacted the platform direct and was told this information cannot come from them - just from the IFA.   The IFA recommends customers use an accountant for tax advice, but with a financial background I didn't want to engage one until I understood the work involved and knew whether I could do it myself or not. Would an accountant be responsible for calculating my CGT position from this Excel data, or would they expect me to provide a statement total that they'd just submit on a return?

Keep_pedalling

What platform are they on? Our IFA uses Transact, and when we still had GIA accounts I could run a CG report for any period I needed, no need to ask the IFA for one.

Hargel112

Its Abrdn Elevate.  I can see an online training video for advisors showing how to extract a CGT summary for clients but for some reason the IFA cant do it and I don't seem to have access from my end. its very frustrating.

dunstonh

 My IFA has told me I made a reportable loss for the year 2022/23 but is unable to provide summary evidence of it that I can send to HMRC.

The majority of IFA platforms have the facility to generate a capital gains tax report.     

The IFA recommends customers use an accountant for tax advice, but with a financial background I didn't want to engage one until I understood the work involved and knew whether I could do it myself or not. 

This is one of those areas that straddles accountants and IFAs or DIY (as its quite easy when the data is in spreadsheet form).

Its Abrdn Elevate.

That is my favourite platform.  Their software is not top tier but they have the best audit trails of any platform.  Its the platform I use the most and they do have capital gains tax reporting functionality.  

It takes the data from the excel doc and converts it into a year by year gain/loss report along with an easier to read breakdown.  It also includes a "what if?" functionality to see what potential trades on the current position would trigger.   The report is exactly what you need as evidence and the totals it gives for each year is all you need.    That figure is what you supply HMRC (assuming its reportable).   You dont need an accountant.  You just need your IFA to do their job.

Go back to the IFA and tell them that another IFA has told you that Elevate do have a capital gains tax calculator and report option and get them to ask Elevate for the link.    Or tell them to use google.

In addition, there is also this site: http://www.cgtcalculator.com/calculator.aspx
If you are good on excel, you can adjust the spreadsheet to match the columns needed. I used to use this years ago before CGT calculators on platforms were available.   But what you should do is get your IFA to do their job (I am assuming you are paying for ongoing advice here)

Malthusian

What reason? There can be a number of reasons why the AXA Elevate CGT calculator may not be able to provide accurate figures. (E.g. transactions that happened outside the platform, or transfers and other transactions that break the calculator's ability to track the base cost.) But I would want to know what it actually is. If they can't give you the figures for the reportable loss, how do they even know there even is one?

Does your Client Agreement with the IFA say they will handle CGT calculations for you? IMHO it should be part of the IFA's job to do the calculation for you one way or another, rather than dumping a spreadsheet on you - but you and they may have agreed differently. Are you paying them for ongoing advice?

Hargel112

Thanks for the comments, which confirm my own thoughts.  I'll check out the calculator and see what the Excel data delivers. My IFA is currently recommending a move away from Elevate to the Atomos platform, which apparently is more user friendly.  Would appreciate thoughts if anyone has experience of it.

dunstonh

My IFA is currently recommending a move away from Elevate to the Atomos platform, which apparently is more user friendly. 

Are you sure its an IFA?   Atomos is for their own in-house salesforce.  Its not available to IFAs.    Their platform charge appears at the lower end but their in-house DFM charges are at the upper end (I have seem 0.80% quoted online).    Has your adviser switched from being an IFA to an FA (or in process of doing so or about to)?

Atomos is a rebrand of the old Sanlam Wealth 

I wonder if the adviser is joining them and is using false pretences on a provider they will lose access to once they move to Atomos as an excuse to move you.

The Atomos model is to run a lower platform charge but higher DFM charges.     This allows them to say that when comparing platforms, they appear cheap.  However, their DFM costs are high.      Now a salesperson would find it pretty easy to use the lower platform charge as a means to promote it over your existing platform with the higher platform charge.    Elevate is whole of market and would have DFMs from 0.1x% (or zero if no DFM used) but they can gloss over that.  Especially if you are already using an expensive DFM and/or fully active funds to begin with. 







https://www.atomos.co.uk/document-repository/atomos-invest-(platform)/at9000-example-illustration-summaries-active-mps

The adviser charge would be on top of those and the OCF of the funds would suggest that its index trackers that are being used.    Index trackers are good but an adviser charge of x.xx%  (as the adviser gets to pick it) plus a DFM of 0.80% on top would make it very expensive.    Index trackers on Elevate would be Elevates charge (which is tiered on value and some IFAs have bespoke terms better than published) plus 0.10% plus adviser charge.  

Be on guard that you are not being converted to a worse solution by a sales rep.

Hargel112

I really appreciate this insight. The advisor I'd had for over 20 years recently retired and the firm he worked for has recently moved under the Atomos umbrella. I have been pretty unimpressed by the service received since and am seriously considering other options, but it's a daunting task and a risk to find a new firm that would be better. During the recent acquisition, there was no mention of any change in IFA status so I will certainly review what I was sent with that in mind.

dunstonh

The advisor I'd had for over 20 years recently retired and the firm he worked for has recently moved under the Atomos umbrella.

There you go.    That is a common retirement model (except insert a variety of restricted company names in place of Atomos).  i.e. IFA retires and rather than sell their book to another IFA who may pay them on drip for x number of years, they sell it to a vertically integrated firm (own platform/product, own salesforce, own portfolio mangement/funds).   Some of these will pay the retiring IFA upto 8x their annual income.

but it's a daunting task and a risk to find a new firm that would be better. 

You are already in that situation because the restricted firm is new to you and restricted firms rarely give the best outcome.   

You are already on a good platform with Elevate and a new IFA could take that over without the need to change platform.   It would likely result in a different investment selection as investing is largely about opinion and with 30,000 odd options out there, you will get some differences.  But not having to change platforms makes things a lot easier.

wjr4

Hargel112 said:

I really appreciate this insight. The advisor I'd had for over 20 years recently retired and the firm he worked for has recently moved under the Atomos umbrella. I have been pretty unimpressed by the service received since and am seriously considering other options, but it's a daunting task and a risk to find a new firm that would be better. During the recent acquisition, there was no mention of any change in IFA status so I will certainly review what I was sent with that in mind.

Find a new IFA!

Malthusian

dunstonh said:

You are already on a good platform with Elevate and a new IFA could take that over without the need to change platform.   It would likely result in a different investment selection as investing is largely about opinion and with 30,000 odd options out there, you will get some differences.  But not having to change platforms makes things a lot easier.

It would probably make it a hell of a lot easier for the new IFA to work out the CGT as well.
Even if the Elevate CGT calculator is broken for whatever reason, and even if it can't be fixed by Elevate, the adviser will have direct access to the original transaction history.
(Admittedly even if you transfer to Atomos and then move to a different IFA, you could still pass the Elevate transaction history spreadsheet to the IFA. But it is one less complication in an already complicated job.)