CSH2: taxation and performance

wmb194

MiserlyMartin said:

A message on Freetrade today informs us that the merger will happen on the 10th of March and you will get 1 share of the new for the old. They then come out with generic blurb about what happens when funds merge etc. But nothing specific to this one. Ie, will the new one be offered on the platform??, they do not make that clear, instead keep on about what happens when some funds are not and it is sold into cash. It's frustrating that they don't make their comms relevant to your fund. The new one will be listed on the LSE from what I read elsewhere, so I presume that FT will be trading that. But we shouldn't have to guess or presume, they should properly tell us

If Freetrade hasn't stated specifically that it won't offer the new fund I'd assume it will and you say it states you will receive 1:1. I have an IT holding with Freetrade that is converting into an OEIC and it's stated specifically that it cannot offer OEICs and it will give me the cash instead.

aroominyork

This notice about the merger has been issued https://www.amundietf.co.uk/pdfDocuments/download/f1757d8b-dcb7-4fa2-a589-b66cfc251412/NoticeToShareholders_LU1190417599_GBR_ENG_20250130.pdf

Would some kind person who is used to these documents care to pick out the key points? One thing that jumped out at me: it states the Lyxor fund is actively managed while the Amundi fund is passively managed. What impact might that have on performance?

masonic

aroominyork said:

One thing that jumped out at me: it states the Lyxor fund is actively managed while the Amundi fund is passively managed. What impact might that have on performance?

Perhaps it is time to revisit the previous discussion on this: https://forums.moneysavingexpert.com/discussion/comment/81273169/#Comment_81273169

Particularly the link describing what a synthetic ETF is.

To test your understanding, what impact does the performance of the current holdings as listed on the fund factsheet have on performance? (clue: begins with N)

aroominyork

Um, yup... my memory is getting even worse with age. Thank you and goodnight.

aroominyork

There is no ERI return shown for the April 2025 CSH2 distribution date (and this site shows Nil ERI returns). Anyone know why? The ISIN was unchanged after the fund merger in March.

LateGenXer

aroominyork said:

There is no ERI return shown for the April 2025 CSH2 distribution date (and this site shows Nil ERI returns). Anyone know why? The ISIN was unchanged after the fund merger in March.

Amundi only seems to publish their CSH2 ERI figures around September every year.  That is almost a year after the reporting period in question, and well past the 6 months mandated by the legislation, but that's the way Amundi seems to roll unfortunately.

If CSH2 wasn't such an unique offering (the only SONIA MMF accumulating ETF I know of) I'd not be using Amundi...

At least it's still in time for Self Assessment.  It's just annoying for CGT planning not knowing what the gains/losses might be.

aroominyork

AndyTh_2 said:

masonic said:

 This would be reported as foreign interest. The remainder would be capital gain.

however ERI would be due in the tax year of 6 months after the ETF's reporting end date, regardless of disposal or holding on to the asset, whereas the capital gain due only on disposal with the ERI as an allowable expense that will reduce the capital gain (similarly to notional dividends from accumulation units).

I've just sold my unwrapped CSH2 which I bought in June 2024. So I need to declare the ERI of €60.7270 per unit for the reporting year 1/11/2023 - 31/10/2024, distributed on 30/4/2025, on my 2025-26 tax return. And I can deduct the total ERI from the proceeds of sale to reduce the CGT due. Is that all correct?

If you sell between 1/11/2025 and 5/4/2026, and you would not declare ERI until the 2026-27 tax return, how would you reduce the CGT bill due in your 2025-26 tax return?

masonic

aroominyork said:

AndyTh_2 said:

masonic said:

 This would be reported as foreign interest. The remainder would be capital gain.

however ERI would be due in the tax year of 6 months after the ETF's reporting end date, regardless of disposal or holding on to the asset, whereas the capital gain due only on disposal with the ERI as an allowable expense that will reduce the capital gain (similarly to notional dividends from accumulation units).

I've just sold my unwrapped CSH2 which I bought in June 2024. So I need to declare the ERI of €60.7270 per unit for the reporting year 1/11/2023 - 31/10/2024, distributed on 30/4/2025, on my 2025-26 tax return. And I can deduct the total ERI from the proceeds of sale to reduce the CGT due. Is that all correct?

Looks correct to me.

aroominyork said:

If you sell between 1/11/2025 and 5/4/2026, and you would not declare ERI until the 2026-27 tax return, how would you reduce the CGT bill due in your 2025-26 tax return?

In the same way. The ERI will be known before your 2025-26 tax return is due.

aroominyork

But it makes you wait until November to submit. Not great if you have a chunky refund due.

masonic

aroominyork said:

But it makes you wait until November to submit. Not great if you have a chunky refund due.

In that scenario you could consider filing with no deduction and amend when the actual figure is known.