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  • Tax on US corporate Bond

    Dear Sir/Madam, I bought 3.125% (coupon rate) Microsoft Corp Bond at a price of US$97.865 on 15 March 2023. It will mature on 3 November 2025, with US$100 to be paid back to me at maturity. As it is a US corporate bond, may I clarify the following: 1. If I leave the bond to mature on 3 November 2025, will the gain be taxed as UK income tax or capital gain tax? 2. If I sell or redeem the bond earlier, say 3 months before maturity, will the gain be taxed as a UK capital gain tax or income tax? 3, In which part of the self assessment or which form should I use for entering the details? I understand that I need to convert the USD into British Sterling before calculation, using HMRC monthly exchange rate. 4. Will this corporate bond be considered a 'deeply discounted security'? Thank you very much for your help. Kind Regards, 

    Name removed admin 
  • RE: Transfer of investment mutual funds from my solo account to a joint account with my wife

    Dear Madam/Sir, Thank you for your prompt reply. Please allow me to ask a follow-up question. As I plan to transfer the assets from my own solo account to a joint account with my wife, in case we dispose of the funds in future, both of us (my wife and I) will be liable to Capital Gains Tax in a 50% / 50% manner. Is my understanding correct? Thank you very much for your help. Kind Regards, Alex Lam
  • Hong Kong Mandatory Provident Fund, Hong Kong Tax Deducible voluntary contributions

    Dear Sir/Madam, Hope this message finds you well. I have relocated to the UK under the BNO scheme and is a tax resident in the UK. I have recently switched the funds in my Hong Kong 'Mandatory Provident Fund (MPF) account', and my Hong Kong 'Tax Deducible Voluntary Contributions account'. They are 2 separate accounts under Manulife Hong Kong. I can only withdraw the money from the HK MPF account and the Tax Deducible Voluntary Contributions account, when I reach the age of 60 and declare retirement. Therefore they behave like a pension scheme, one is mandatory while the other is voluntary. The HK MPF was related to my previous employment and would benefit from the Double Tax Agreement between Hong Kong and UK. I believe it is free of UK tax on withdrawal. On the other hand, the 'Tax Deducible Voluntary Contributions' will be subjected to UK Tax on withdrawal, because it is voluntary. Unfortunately I suddenly remember there may be tax implication in switching the funds. Here are my queries: 1. Do I need to worry about capital gain tax when I switch funds inside my HK 'MPF account'? 2. Do I need to worry about capital gain tax when I switch funds inside my Hong Kong 'Tax Deducible Voluntary Contributions account'? Do I need to report these to HMRC in my coming tax return for 2023/2024? 3. Am I correct in saying that any gain in the 'Tax Deducible Voluntary Contributions Account' will be subject to UK income tax in the year that I take out the money? 4. For 'Tax Deducible Voluntary Contributions Account', the statement will show the total amount that I contributed in the past since inception of the account, and the total gain or loss since inception of the account. Will these information be sufficient in calculating my gain from the account and thus the income tax, when I decide to take out the money after 60 of age? Instead of considering each of the individual funds inside the account under the scheme. Sorry for my long-winded questions. Thank you very much for your help. Kind Regards, Alex Lam
  • Transfer of investment mutual funds from my solo account to a joint account with my wife

    Hello, I have a question about transfer of investment mutual funds. My wife and I come from Hong Kong and are currently tax residents in the UK. I have a solo bank account in Singapore, as well as a joint account with my wife in the same bank. We are living in the same place in the UK. I plan to transfer 4# investment mutual funds from my own solo bank account to our joint account with my wife. May I ask will there be any tax implication, e.g. CGT, in doing the transfer? Do I need to report the capital gain or loss in the 50% of each investment mutual fund transferred to my wife? After the transfer of the mutual funds to our joint account, do I need to report this in my tax return next year? Furthermore, according to HS281, 'If you and your spouse or civil partner are living together, any transfer of an asset between you is treated as giving rise to neither a gain nor a loss to the person transferring it. Any amount actually paid is ignored. If the person receiving the asset later disposes of it, they will be treated as if they had paid an amount equal to the total of your costs.' May I ask does the 'asset' mentioned above also include shares and investments (like investment mutual funds in my case)? Thank you very much for your help. Kind Regards, Alex Lam