How to deal with CGT when initial cost of fund unknown

[syrio]

I want to sell/reduce holdings in a fund as much as possible without paying Capital Gains Tax, but have no idea what the initial cost of the fund was.

Current value of the fund is about £44k. It is

JPM Global Unconstrained Equity Fund C - Net Accumulation

https://finance.google.co.uk/finance?q= ... H4Uf2fn7AP

I have no idea of how much has been invested into the fund, or even how long it has been held, other than it has been held for a long time. Probably bought in the 1960s or 1970s. It was initially called Scotbits, and has various name changes and owners since then - Save and Prosper Growth Fund, then JP Morgan have given it a couple of different names. So it isn't easy to estimate what the gains might have been.

Additionally, it is an accumulation fund, so some of the growth will be due to re-invested income, effectively making the capital gain less. But it is going to be very difficult to work out how much of this is income.

Obviously it is possible to just sell an amount of shares which equals the capital gains allowance - £11300, and then there will be no capital gains and no need to report it to HMRC. Ideally though I'd like to sell it more quickly than £11300 a year if that was possible.

Does anybody have experience of a similar situation - did you make an estimate of the initial cost?

[PinkDalek]

Your first port of call would be to establish the 31 March 1982 for CGT rebasing purposes. If there have been no acquisitions/disposals since then then that is what I would use.

As for the accumulation aspect, no-one will force you to reduce the gain per se!

[syrio]

Your first port of call would be to establish the 31 March 1982 for CGT rebasing purposes. If there have been no acquisitions/disposals since then then that is what I would use.

Thanks, I hadn't realised that was the case.

However I still can't find the March 1982 values, although perhaps it might not help me that much if I did. I had a look at what happened to the FTSE 100 and the S&P 500 since 1982.

FTSE 100 went from about 1000 in 1984 to 7700 today. Approx 7x increase
S&P 500 went from about 111 in March 1982 to 2794 today. Approx 25x increase

If there was a 7x increase in the value over the period, then I could sell about £13181 worth to realise a capital gain of £11300 to avoid CGT.

If there was a 25x increase in the value, then I could only sell about £11750 worth.

So I may just sell £11300 worth so I don't have to worry about capital gains at all.

[pochisoldi]

Your first port of call would be to establish the 31 March 1982 for CGT rebasing purposes. If there have been no acquisitions/disposals since then then that is what I would use.

Thanks, I hadn't realised that was the case.

However I still can't find the March 1982 values, although perhaps it might not help me that much if I did. I had a look at what happened to the FTSE 100 and the S&P 500 since 1982.

FTSE 100 went from about 1000 in 1984 to 7700 today. Approx 7x increase
S&P 500 went from about 111 in March 1982 to 2794 today. Approx 25x increase

If there was a 7x increase in the value over the period, then I could sell about £13181 worth to realise a capital gain of £11300 to avoid CGT.

If there was a 25x increase in the value, then I could only sell about £11750 worth.

So I may just sell £11300 worth so I don't have to worry about capital gains at all.

If you are married, see if you can transfer part of the holding "as is" to your spouse (a no loss/no gain transaction), that way you can double the disposal rate.

Alternatively see if the holding account can be made into a joint account, or treated as being held in trust 50/50 with your spouse, then flog £22600 relying on the default situation that a joint account is held 50/50. Get this done before March and you might have the full holding cashed in by mid April (one tranche before April 5th in this tax year, the second tranche sold after April 5th in the next)

PochiSoldi

[scrumpyjack]

If your gains are less than 11,300 and disposal proceeds less than 4 times that in a tax year you do not need to report it in your tax return, so splitting in between yourself and you wife and selling half before 6th April and half afterwards you don't even need to tell the taxman about it.