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Capital Gains incorporate fees and costs

Questions on using, creating, or understanding data in Fund Manager reports.

Postby kosmicmisfit » Sat Sep 18, 2021 8:39 am

Hello
A lot of the trades are done on margin. I use Schwab & IB.

I wanted to know what is the best way to factor in the incidential cost of trading.

In addition there are subscriptions and other costs like purchase of FM which need to be factored in cap gains calc.

Please advise
thanks
kosmicmisfit
 
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Postby kosmicmisfit » Sat Sep 18, 2021 9:13 am

Update

I found the Account Fees dist type. However, it seems the fees are not taken into account even though I have selected 'include account fees' in the report pref.

The Cash account currency is USD. Screenshots are attached
Attachments
Account fee.pdf
(58.48 KiB) Downloaded 99 times
kosmicmisfit
 
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Postby kosmicmisfit » Sat Sep 18, 2021 9:46 am

Update again
I noticed the error in my ways and have amended the account fees as per the attachement. However, the fees are still not reducing the cap gains
Attachments
amended account fees.JPG
amended account fees.JPG (43.19 KiB) Viewed 1491 times
kosmicmisfit
 
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Postby Mark » Sun Sep 19, 2021 10:15 am

Hi kosmicmisfit,

It looks like you are recording this account fee in your cash investment? For an Account Fee to increase the basis of a capital gain, it must be recorded in the same investment where you sold the shares.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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Postby kosmicmisfit » Mon Sep 20, 2021 4:59 am

I didn't follow this. Can you provide instructions. I feel there should be better step by step documentation or videos on these common topics.

I have tired to create an investment titled 'Margin Fees'
Distribution type is 'Account Fee'.

I am using the pro version. UK tax year is from April 6 to April 5.

Date Received & For shares owned are both set to 06/04/21 (UK date format)
Reinvested is unticked.
Value is -1000.

Distribution per share prompt come up value is -1000

Still no impact on cap gains!
kosmicmisfit
 
Posts: 18
Joined: Sun Dec 16, 2018 10:57 am

Postby Mark » Mon Sep 20, 2021 8:35 am

Hi kosmicmisfit,

I have tired to create an investment titled 'Margin Fees'


I think this is the point of confusion. Instead of creating a new investment, put the account fee transaction in the same investment where you sold shares to create a capital gain event, not in another investment in the same sub-portfolio.

Here are some instructions to demonstrate this feature:

1) Create a new investment and buy some shares on date Sep 1, 21
2) Record a non-reinvested account fee in this same investment with a negative value on Sep 15, 21
3) Record a sell transaction in this same investment for Sep 20, 21
4) Create a Capital Gains report covering Sep 20, 21, and under "Options / Report Preferences... / Capital Gains" turn on the option "Include Account Fees in Basis"

Your Capital Gains report should have 1 line item, and the basis will be increased due to the Account Fee transaction. When you enter an Account Fee transaction, that fee is applied evenly to all the shares owned as of that date, as far as determining how to distribute the fee among the basis for each share.

See my screenshot demonstrating the above example:

Screenshot 2021-09-20 082650.jpg
Screenshot 2021-09-20 082650.jpg (49.7 KiB) Viewed 1453 times


I sold half the shares, so half of the account fee has been added to the basis. The basis is $525 instead of $500.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
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Postby kosmicmisfit » Mon Sep 20, 2021 8:58 am

Oh
I understand!

However, I have over a 1000 trades. So is there an alternative?

Using Excel I have approportioned the margin fee for each sale and added it to the comission box.
I thought that there would be a smarter option to acive the same objective.
kosmicmisfit
 
Posts: 18
Joined: Sun Dec 16, 2018 10:57 am

Postby Mark » Mon Sep 20, 2021 11:26 am

Hi kosmicmisfit,

There isn't a feature where you can take an account fee associated with 1 investment and distribute it somehow over the gains/losses of all the other investments in the account. For capital gain calculations, every investment is stand-alone. If you just want your total gain/loss to be affected for the whole account, you could create a fake "Margin Interest" investment, and make it lose the amount that is equal to your account fee. It would be a separate line item, affecting the overall total, but not the individual transactions from the other investments.
Thanks,
Mark
Fund Manager - Portfolio Management Software
Mark
Site Admin
 
Posts: 10531
Joined: Thu Oct 25, 2007 2:24 pm
Location: Chandler, AZ


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