Jump to content
House Price Crash Forum
Sign in to follow this  
Badhairday

How Are Profits From Etf's Taxed? As Capital Gains?

Recommended Posts

I bought some ETF's recently and noticed I did not have to pay stamp duty ON them as you normally do with other stocks and shares. Does this mean that ETF's are also taxed differently? Are the gains exempt for the first 9K or so, as per capital gains tax?

Share this post


Link to post
Share on other sites

There is no stamp duty when buying foreign companies (including offshore companies incorporated in the Channel islands, Ireland, etc.) - the same exemption applies to buying into ETFs. There is no stamp duty to pay when you buy units of the ETF.

However, the ETF will have to pay the stamp duty on any purchases they make. So if you buy a FTSE tracker, then whenever the fund creates more ETF shares by buying shares in Tesco, BG, etc. then stamp duty will be charged on those purchases, the money coming from the fund's 'management fee'.

Sales of ETF shares are taxed in the same way as other shares - you pay CGT on any profit you make, after your annual allowance, and any allowable capital losses. Dividend income from ETFs, again is the same, it's taxed as dividend income (which, is for practical purposes, the same as other forms income).

When held in an ISA, there are no tax liabilities, and no tax allowances - so a capital loss on an ISA, cannot be used to offset capital gains outside the ISA.

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 399 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.