Hi HMRC! I own some Vanguard VGOV shares (Vanguard UK Gilt UCITS ETF –ISIN IE00B42WWV65) which are 100% UK gilt/bonds. My understanding is that the distributions should be treated as interest, not dividends, because they are 100% bonds. However, I have just received a Consolidated Tax Statement (CTC) from HSBC where they put all my distributions under dividends, with nothing under interests. I can’t currently get any answer from HSBC, but I don’t want to make a mistake on my tax return. I will keep chasing HSBC for an answer, but it would help if you could confirm how Vanguard VGOV distributions should be treated: Dividends or interests? Furthermore, as Vanguard is domiciled in Ireland, my understanding is that the distributions should be treated as foreign interest (although they are made of UK bonds). For information, my total foreign dividends and interests are more than £2000. Is this correct? Thank you.
Dear Admin 5,
Thank you for your reply confirming we should use SA106, Page F2 “ income from overseas sources” to declare our Singapore REIT dividends (about 7000 pounds/year). Could you please just be a bit more specific as we can’t see any PID box on page F2. Do we therefore enter our Singapore REIT dividends under “Dividends from foreign companies” and mention they are from Singapore REITs in the additional information notes? Many thanks in advance for confirming.
I am a UK tax resident and I receive dividends in excess of £7,000 per year from some Singapore REITs. Last tax year, I saw an answer on this site from HMRC Admin 19 saying that Singapore REITs are to be treated as (foreign) dividends, as per art. 10 of the Singapore-UK DTA (Multilateral Instruments and the 1997 Singapore-UK double taxation agreement), and stating that any gains would be subject to Capital Gain tax rate. This is how I treated those Singapore REIT dividends on my 21-22 tax return. I’ve kept a screenshot of HMRC Admin 19’s answer, but I can’t find it anymore when I search the site. Can HMRC therefore please confirm that this tax treatment of Singapore REITs dividends as foreign dividends rather than income is still correct for this tax year? (Indeed, as per the Investment Funds Manual quoted by HMRC Admin 17 they clearly don't come under the definition of an offshore fund, being "closed-ended arrangements that do not have a limited life", and similar to UK REITs). Thank you for confirming.