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Buying gilts - which platform to use?
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HL will not give you that information. Various websites do give that information, but it depends on your tax situation and the rate of inflation. You are best to work it out yourself:
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HL does not let you trade new style ILGs online because of the cost and difficulty of providing that facility. SWSD and AJ Bell both let you trade now style ILGs online by typing in an order without knowing the price. A dealer then executes order shortly afterwards. It is possible to trade new style ILGs online with Interactive Brokers (IBKR), which has an electronic connection to one of the GEMMs (i.e. the main market market makers). With the other platforms, we have to trade through the retail market makers.
As I said, you do not pay accrued interest. It is a tax allowance against the next dividend.
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HMRC will receive the contract note. The coupon against which you receive the accrued interest allowance may be in the tax year after you made the purchase. You will have to do Self Assessment if you trade gilts. HMRC will not work out your tax liability. You have to do that, and risk being penalised if you get it wrong. If you trade gilts, you need to know what you are doing or hire an accountant.
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…or hold them within an ISA or SIPP as I do.
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I would like to understand more about gilts.
@masonic
May I ask why you 'hold them within an ISA or SIPP?' as I was planning to buy my ILG unwrapped and allocate my ISA wrapper for funds (OEIC) etc as hoping the funds will grow a bit more than the ILG and also I will hold a high percentage in OEIC than gilts so thinking there will be more CGT to pay on the OEIC.
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HMRC receives contract notes? You're certain? I can't find any evidence of this and brokers don't presently supply data on interest and dividend payments (HMRC's planning to implement this). Across all investors supplying every contract note would be an incredible amount of data. No doubt they could be provided on request.
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My next door neighbour is a tax advisor. She said that HMRC has this data stored on two computer systems, and uses it to check CGT calculations. I do not know how the data is collected.
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I am interested in fixed gilts and not index linked gilts so that simplifies it. someone said when you buy the gilt on HL, they will tell you at the purchase stage how much accrued interest had been accumulated. i will try this out and see if that is the case, but i suspect the website won't be sophisticated enough to calculate this on a daily basis and it is something that is done when the next coupon is paid.
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HL sends the annual tax summary to HMRC, which you also get but it doesn't send the individual contract notes, that would be too much info that HMRC won't want to have. the summary is going to be good enough.
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Based on a document linked in a thread from a day or two ago this doesn’t appear to be the case: HMRC is currently consulting on how to collect dividend, interest and other income data from stockbrokers.
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