CGT ON 'NOTIONAL' GAIN GIA FOR TAX RETURN

HappyHarry

Dazed_and_C0nfused said:

Nomunnofun1 said:

DRS1 said:

So a third party can buy and sell your shares without you having a say in the matter?

Is that discretionary portfolio management?

Is that a good idea?

Very common - hopefully the increase in the value of the portfolio as a result of these decisions covers their fees!

But it sounds awfully like the portfolio manager can, in theory at least, create Capital Gains liability which the op doesn't necessarily have the cash funds to pay?

Yes that happens a lot. The OP can, of course, sell some of their holdings to pay the CGT.

Dazed_and_C0nfused

HappyHarry said:

Dazed_and_C0nfused said:

Nomunnofun1 said:

DRS1 said:

So a third party can buy and sell your shares without you having a say in the matter?

Is that discretionary portfolio management?

Is that a good idea?

Very common - hopefully the increase in the value of the portfolio as a result of these decisions covers their fees!

But it sounds awfully like the portfolio manager can, in theory at least, create Capital Gains liability which the op doesn't necessarily have the cash funds to pay?

Yes that happens a lot. The OP can, of course, sell some of their holdings to pay the CGT.

True, it just seems a slightly odd situation that you could end up in!

Bookworm105

Dazed_and_C0nfused said:

HappyHarry said:

Dazed_and_C0nfused said:

Nomunnofun1 said:

DRS1 said:

So a third party can buy and sell your shares without you having a say in the matter?

Is that discretionary portfolio management?

Is that a good idea?

Very common - hopefully the increase in the value of the portfolio as a result of these decisions covers their fees!

But it sounds awfully like the portfolio manager can, in theory at least, create Capital Gains liability which the op doesn't necessarily have the cash funds to pay?

Yes that happens a lot. The OP can, of course, sell some of their holdings to pay the CGT.

True, it just seems a slightly odd situation that you could end up in!

indeed, hence the manager produces a report so you know what you owe !

By definition a GIA is where you have no ISA allowance remaining and therefore all and any disposals of the fund components are exposed to CGT irrespective of whether the sales proceeds are reinvested in new purchases or withdrawn to OP's personal bank account. That net gain is taxed as a result.

There is nothing "notional" about that CGT report, it is what is reported to HMRC and is what you owe.