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CGT on transfers of accumulation funds between spouse
HamAndCheese
Posts: 20 Forumite
in Cutting tax
Hey,
Can anyone point me in the right direction as to how to correctly declare this to the tax man?
I owned units of an index accummulation fund for several years. I have declared and paid tax on the reinvested dividends from this fund. I have now transferred ownership of half these funds to my spouse (who lives with me etc.).
How do I declare to the tax man that X amount of tax has been paid on reinvested dividends and so the CGT liability should be adjusted for this? Do I declare it all on my half as I actually paid the tax? Does the tax paid effectively follow the funds and so my spouse can declare the tax I have paid to reduce the CGT they pay on the funds?
I've read through what I can find on HMRC but not being a finance professional I find it a bit baffling to understand and I don't think anything addresses this specific scenario!
0
Comments
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The transfer between you and your wife is at no gain no loss. Her base cost will be half the original cost plus half the reinvested dividends.
You will only need to tell HMRC about the base cost on a sale or gift to someone other than your wife. Then you add the amount declared as income and reinvested to the original cost. What tax you paid on the reinvested dividends is irrelevant.1
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