Money Market Funds ?

masonic

SloughSally said:

I understand that gains in STMMFs are eligible for CGT , but since in reality it’s interest does the gain and CGT get reported early on a self assessment or only after I sell in the future, I hold them currently in a S&S ISA which I know will avoid the CGT , but considering adding some to my GIA .
Thank You.

There are some complexities involved with certain STMMF, for example CSH2, where it really isn't at all clear what the income should be declared as. If holding outside of an ISA/SIPP I would stick to simpler options such as the RL or Vanguard funds.

SloughSally

It is with RL.

GeoffTF, I am aware of reporting re invested dividends in my self assessment regarding such funds as Vanguard LS 60 etc, I assume it would work the same way with a STMMF with RL held within a iWeb GIA ?
So I would be paying income tax on the value of the reinvested dividends and CGT on the same dividends when I sell, so taxed twice on the same income/gain.

masonic

For an accumulating fund, you deduct the income from the capital gain. This is true for VLS60 dividends or the RL STMMF interest. It requires good record keeping, as you could need several years worth of data when you eventually come to sell.

SloughSally

Masonic, that is  brilliant information, thank you so much.

GeoffTF

cloud_dog said:

SloughSally said:

I understand that gains in STMMFs are eligible for CGT , but since in reality it’s interest does the gain and CGT get reported early on a self assessment or only after I sell in the future, I hold them currently in a S&S ISA which I know will avoid the CGT , but considering adding some to my GIA .
Thank You.

Most STMMF are likely to come under the income tax regime, although it is very dependant on how the fund is structured, e.g. made up predominantly of bonds means income tax liability. 

You will still have to pay CGT on any capital gain. The share/unit price increases from one ex-dividend date to the next ex-dividend date.