Capital Growth funds or ETFs

Pat38493

Is there any such thing as funds or ETFs that are designed to generate only capital growth and zero (or minimal) dividends?  (such that if you have them in a GIA you only have to worry about Capital Gains tax).

If so can I get some examples and/or a good way to search for them on Pickafund or Morningstar?

squirrelpie

Such funds and ETFs are called 'accumulation' funds or ETFs.

To search on Morningstar, select ETFs and the ETF Screener. Filter on yield 0-2% and sort on it and look at the early listings. There may be other ways.

Pat38493

squirrelpie said:

Such funds and ETFs are called 'accumulation' funds or ETFs.

To search on Morningstar, select ETFs and the ETF Screener. Filter on yield 0-2% and sort on it and look at the early listings. There may be other ways.

I am wondering whether the “Yield” figure in sites like Pickafind is reliable as an indicator.  There are a lot of funds with 0 yield.  However take fund HMWO vs HMWS.  HMWS is the accumulation version of HMWO.  I know for sure that HMWO pays income / dividends, so I would think that HMWS must have reinvested income/dividends as well, but on the Pickafund site the yield shows as zero.

squirrelpie

I have no idea what you're thinking. You say that HMWS is an accumulation fund/ETF. You say that the yield is zero. And you say that it must have reinvested income and dividends. That's exactly what I would expect an accumulation fund/ETF to do. So what's the problem?

sofm

squirrelpie said:

I have no idea what you're thinking. You say that HMWS is an accumulation fund/ETF. You say that the yield is zero. And you say that it must have reinvested income and dividends. That's exactly what I would expect an accumulation fund/ETF to do. So what's the problem?

The divis are still subject to tax even in accumulation fund?

NoMore

Presumably they are trying to make working out the tax due in a GIA easy. Accumulation funds can be tricky as the re invested dividends are still subject to income tax and therefore have to be tracked. Its not too difficult either but lots of advice does say to avoid accumulation funds (if possible) in GIA for this reason.

Personally I think they are overthinking this by looking for capital growth only stocks/funds, and just invest in what you want in the GIA and track the dividends if required, can always avoid accumulation funds and just get the income version and manually re invest the dividends, makes tracking them easier

Pat38493

squirrelpie said:

I have no idea what you're thinking. You say that HMWS is an accumulation fund/ETF. You say that the yield is zero. And you say that it must have reinvested income and dividends. That's exactly what I would expect an accumulation fund/ETF to do. So what's the problem?

Not a problem normally - just that if they are held in a. GIA account, I would have to track the dividends paid on an ongoing basis to declare them for tax purposes, whereas if there is only capital gains, I don’t have to track it so closely as there is only a taxable event when I actively decide to sell something.

dont_use_vistaprint

I bought  UK treasury bills when I didn’t have to pay CG tax, zero coupon, guaranteed gains 

ColdIron

Pat38493 said:

squirrelpie said:

I have no idea what you're thinking. You say that HMWS is an accumulation fund/ETF. You say that the yield is zero. And you say that it must have reinvested income and dividends. That's exactly what I would expect an accumulation fund/ETF to do. So what's the problem?

Not a problem normally - just that if they are held in a. GIA account, I would have to track the dividends paid on an ongoing basis to declare them for tax purposes

Your platform will provide you with an annual Consolidated Tax Certificate. You can simply copy the details from that

DRS1

dont_use_vistaprint said:

I bought  UK treasury bills when I didn’t have to pay CG tax, zero coupon, guaranteed gains 

Are those the ones where the gain is subject to income tax?  Probably not something you want in a GIA?

poseidon1

DRS1 said:

dont_use_vistaprint said:

I bought  UK treasury bills when I didn’t have to pay CG tax, zero coupon, guaranteed gains 

Are those the ones where the gain is subject to income tax?  Probably not something you want in a GIA?

Definitely not ideal for a GIA account. All UK T Bills are deeply discounted securities liable to income tax on maturity.