Offshore income and gains/losses

CharlesLincs

I had a thread a while back (see https://forums.moneysavingexpert.com/discussion/6395698/cgt-unreported-loss-from-2019-20-but-is-it-a-loss ) about helping a friend with her income tax and am happy to say that things have turned out well, again thanks to @Jeremy535897 for his help!

So... my friend's offshore portfolio has been cleared up (somewhat), she's got rid of the non-reporting stuff and we're now thinking about starting to prepare the 23/24 SA. The UK bits are easy as their investments are either all in ISAs (so not relevant for SA) or simply generate bank interest payments. It's again the offshore element that's causing trouble. I *think* we filled the various boxes correctly last time... but then again, perhaps not. So I am now trying to "condense" my thinking into a few simple (?) statements of belief/fact and hope these are correct.

There are two elements to this whole sorry saga: income and CGT. I'll first get to income.

My friend has no income for SA106 pages F4/5 (Income from land and property abroad) or SA106 F6 (Foreign tax paid on employment, self-employment and other income). All her income relates to her offshore portfolio, ie SA106 pages F2/3. The only two fields there I can identify as relevant are "Interest and other income from overseas savings" and "Dividends from foreign companies". Which means we have to decide whether an income is interest or dividends. My understanding is and has been that all bank interest, interest from bonds/gilts or income from ETFs/funds/OEICs, if they hold 60% or more of their assets in fixed income investments, goes into the "Interest..." field.
OTOH share dividends and all income from ETFs/funds/OEICs with less than 60% of their assets in fixed income investments goes into the "Dividends..." field. So basically I (or the tax payer) must somehow decide whether a certain ETF/fund/OEIC holds more or less than 60% of assets in fixed income investments. For many investments that's obvious but if not I assume the manager of the fund in question) should be able to clarify this (in writing if possible?).
The same distinction between interest/dividends will have to made in the case of funds with Excess Reportable Income, I assume, and this income has to be added to the relevant field as well. Also, my friend has to make a mental note that those ERI payments can later, upon selling the asset, be offset against possible gains. (None of her funds currently have ERI but some had in the past, so it might come up again.)
Did I forget anything on the income side?

Now to CGT. I think that for CGT purposes all gains or losses from reporting ETFs/Funds/OEICs, shares and bonds are treated as usual (ie as they would be treated if they were held in a non-ISA UK portfolio). OTOH, gains from all non-reporting ETFs (which she has got rid of for now, but who knows) will count as income and will have to be declared in SA106 as such. Whereas losses from non-reporting ETFs etc can't be used to offset against gains from non-reporting ETFs etc, instead they will need to be declared as GCT losses and will be treated as such, ie they will offset same year gains or, if no exist, can be turned into allowable losses and can be use to offset against future gains. In this case we would have to notify HMRC of those losses and claim them as "allowable", I think?

If that's all correct (if not please tell me!), there still remains the small matter of actually calculating the £ values from the EUR numbers. In the past we've simply used the published monthly figures off the HMRC website but my friend has, perhaps because she was bored, looked up the actual day-to-day values for the dates concerned and to my surprise these quite often (or at least more often than not) turned out to give her slightly lower £ values than the monthly HMRC figures (mind, we're talking about pretty small percentages here, but if you have around 10,000EUR interest/dividends even small differences do add up). The site in question is https://www.exchangerates.org.uk/EUR-GBP-exchange-rate-history.html and they seem legit to me. Can we use whatever sources we want or do we have to take the HMRC-published figures? (At any rate, I assume we can't pick and mix and use whatever rate is better for her... that would be too much to expect.)

Thanks for looking into this!

Jeremy535897

The tax treatment is explained here:
https://techzone.abrdn.com/public/investment/Guide-Taxation-of-Collectives
Also see:
https://www.gov.uk/government/publications/offshore-funds-self-assessment-helpsheet-hs265/hs265-offshore-funds
For individuals, the appropriate forex rate is the rate at the date of the transaction, although the monthly figure will do. I don't think you can pick and choose between the two, depending on when it suits you.

CharlesLincs

(Sorry answering so late, have been on a boat in Norfolk with total smartphone verbot ).

Thanks @Jeremy535897 for the linkies. I've been through what feels like a thousand pages about these things and I've even had some lengthy discussions with actual HMRC staff on https://community.hmrc.gov.uk/customerforums/pt (the guys answering there are often not really able to help... it's happened that I've received completely wrong answers and even clearly conflicting advice from separate HMRC employees). So my OP was simply an attempt to "condense" my current understanding into a hopefully correct set of statements.
As to the forex thing, yes, I think we have to take one or the other. The differences are small, anyway.