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I have 5 different Hargreaves Landsdoqn multi manager funds,

Resolved Question:

Hi,
I have 5 different Hargreaves Landsdoqn multi manager funds, totalling £270k at todays prices.
3 of them i have had for 2 yrs and 4 months, 2 for one year exactly.
- If I want to sell £20k worth while the market is high ( to invest in this years ISA and to pay off some other debts) how do I choose which fund to sell from in order to avoid capital gains tax? i.e. if I have made a gain over 2 years on a fund, can the gain be spread over 2 years?
- If I sell , say, 5k from a fund that I put 80k into, which has made £10k in total over the 2 years, is that a 5k gain? Or is it calculated pro rata, some initial capital back, some gain?
Many thanks for your help
Submitted: 10 months ago.
Category: Tax
Expert:  Sam replied 10 months ago.

Hi

Thanks for your question - I am Sam and Ia m one of the Uk tax experts here on just Answer.

As the sale will incur a capital gain position - then the sale price will be split between part initial capital and part gain but I am afraid you do not had the gain treated as split over anything other than the one year - UNLESS the gain is subjected to 28% (high rate tax) when had it been split over the two years (in this example) then only liable to 18% (if each of the gain for each of the years stayed within your unused basic rate band)

So you need to ask the portfolio manager which gain will best serve you well - as the first £11,100 will be exempt as this is your annual exemption allowance for 2016/2017 and then if you took out £20K then this would see £9,900 liable to capital gain tax -

But ideally it will be one that is newer and has preformed less well as then you would be taking out more capital and less gain - so to speak - but the manager will be able to make instant calculations for you (and may even recommend a mix from each of the funds)

Let me know if I can assist further

Thanks

Sam

Sam, Accountant
Category: Tax
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