Handling equalisation and accumulation units from UK/IE funds

Most of my fund holdings are accumulation units, which have notional distributions (taxed as dividends) which is typically recorded as increasing the cost base (so that you’re not taxed a second time as capital gains). These distributions often also include an equalisation payment (a return of capital), which would correspondingly reduce the cost base.

How does anyone handle these in Sharesight? It seems to pull in the dividends but doesn’t have any awareness of the fact it’s an accumulation-based share class.

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For reference, as I figured this out with the assistance of Sharesight support.

Say you have a notional distribution of £100, of which £30 is an equalisation and £70 is an accumulation distribution, you will need the following:

  1. Entry in the ‘All distributions’ section, of £70.
  2. Entry in the ‘Trades & adjustments’ section of a ‘Capital call’ of £100
  3. Entry in the ‘Trades & adjustments’ section of a ‘Return of capital’ of £30

In this way your cost base, dividends and total return figures will be correct.

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Hi. How do you figure out the breakdown of the dividend? I’ve had a look and can’t see these figures for the funds I hold. Any insight gratefully received!

Which platform are you on? At least on the ones I use, they give you the notional equalisation numbers alongside any notional dividend - because it has to go on the UK CGT report that most platforms provide.

On AJBEll this looks like:

Equalisation Acc Units - HSBC Global Strategy Dynamic C Acc - 30
Accumulation Distribution - HSBC Global Strategy Dynamic C Acc - 100

(so those go in as a capital return and capital call, and you then have a notional dividend of 100-30 ie 70)