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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4983
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Where to disclose Cayman Hedge Fund Income Loss on SA retu

Customer Question

Where to disclose Cayman Hedge Fund Income Loss on SA return
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
and welcome to the site. Thank you question.

Please clarify if you are referring to capital loss on this fund?

Many thanks
Customer: replied 2 years ago.

No it is income loss. Through BNY Mellon, my client invested funds to carry out Commodities Trading and has sustained income loss in the region of $ 209,530

Expert:  taxadvisor.uk replied 2 years ago.
Mohamed, thanks fo ryour reply..

Please advise if your client is trading as sellf employed commodities trader or as an investor when you say, he invested funds to carry out commodities trading and sufferred income loss

Many thanks
Customer: replied 2 years ago.

I am waiting 's response.

Thanks

Expert:  taxadvisor.uk replied 2 years ago.
ok, thanks
Customer: replied 2 years ago.

BNY were the administrator to a Cayman Fund where the money was invested by a separate management company under their own discretion, h was the principle.

Expert:  taxadvisor.uk replied 2 years ago.
Mohamed, thank you reply.

Based on information and explanations provided, this appears to be capital loss and any realised loss should be reported within Capital Gains section in box 6.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

No this is not correct. The investment was made to a non-reporting fund as as per the paper If the client is correct than where should it be disclosed.

Thanks

Customer: replied 2 years ago.

No this is not correct. The investment was made to a non-reporting fund as as per the paper. If the client is correct, where do I disclose it.

Thanks

Expert:  taxadvisor.uk replied 2 years ago.
Mohamed, thanks reply.

I am happy to look into it now that you have provided additional information.
I will revert to you ina while.

many thanks
Customer: replied 2 years ago.

Where you able to get any response?

Thanks

Expert:  taxadvisor.uk replied 2 years ago.

Mohamed, thank you reply.

I don't have good news ...

There is no relief against income loss on disposal of an interest in a non-reporting fund.

More information on this can be found on the top of page 2 of this article here

http://www.tax.org.uk/Resources/CIOT/Documents/2011/09/Offshore_Funds.pdf

Please see this link too

http://www.srdtaxmanagement.com/assets/files/Offshore%20Income%20Gains.pdf

I hope this is helpful.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond. Please only rate my answer if it is acceptable.