The totally NOT complicated investment tax post

Can the W-8BEN be filled after investment but before any returns?

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Great post. Again.
The man doesn’t know how not to write.
Congrats on the Weekend Read initiative


You just missed all about the complex UK Share matching rules… that’s what makes UK CGT complex.

Same Day
Next 30 days FIFO

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The form is expressly for the purposes of income so technically maybe you could wait until you receive a dividend if your broker allowed you.

However, because of the difficulties of administrating US taxes (which the form also eliminates), no major U.K. broker I’m aware of would let you buy US stocks before you sign the form.

Especially because there’s no downside.

However, @JamieP, one of our ops wizards, may have more detail.

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Thanks for the post. A lot of useful info in here. So how about that W-8BEN form with Freetrade? I wasn’t aware of it. Maybe add some prompt for users to fill it out before they buy their first US stock?

Also, I’d like to see some pricing for ISAs in the post. I only learned about the fees accidentally browsing the forum for something else. I would have appreciated some sort of an alert upon opening my ISA.

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Thanks for the suggestion - we’re on the same page here, you’re required to complete the W-8BEN form before you purchase a US stock on Freetrade. You’ll be prompted to do that when you tap buy on any US stock’s page.

ISAs are free until at least July 2019 but when you go to open an ISA, we display the price like this -

& if you open an ISA now then we’ll give you a heads up in advance, before we begin charging for the ISA.


Thanks for the response. Maybe I’ve missed this screen when opening my account.

However, I don’t recall seeing anything about W-8BEN when purchasing US stocks.

You probably completed it so quickly that you forgot you did it :grinning: it’s not possible to buy US stocks in the Freetrade app without doing that first.


Oh, good to know. Maybe what you said, yes.
Thanks for fool-proofing it for absent-minded investors like me. :smile:


I’m thinking more about Fig’s kinda-share-kinda-dividend-kinda-revenue-share thing rather than regular stocks.

Isn’t @Mattrawly (hello, welcome!) correct that working out the capital gain in tax-unwrapped investments in @Toby’s CGT section might be slightly complicated by the way that sales are matched to purchases? See eg this Gov CGT helpsheet which explains the “same day, then following 30 days, then the rest in proportion” rule.

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You are correct. I am a Tax Adviser and felt I should comment as I see so many people getting into a mess in terms of Capital Gains Taxation with investments in Shares/Securities, Gold/Silver and particularly Cryptocurrencies.

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If I buy shares over a period of time, then sell a proportion of my shares, do the olderest or newest get sold?

For example I may have 100 shares, 50 are over 1 year old, 50 are 6 months old, I’d have different tax implications depending on which shares were sold first.


Everything will be averaged. You total value is divided by the total number of shares you hold.

The cost of any given share in a Section 104 holding is calculated with reference to the total amount paid for the overall holding divided by the number of shares held. For example, if 2,000 shares had been purchased in 500 share tranches, costing £500, £1,000, £1,500 and £2,000; the total cost of those 2,000 shares is £5,000, or £2.50 per share.

Here is a more thorough guidance from HMRC

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Thanks Vlad, I know the price of the shares is averaged out. My question was for tax purposes. Because if you hold a share for more than 1 year the tax implications are different

I think you have the US tax code in mind, where if you hold your assets for less than a year, they constitute short-term capital gains and are taxed at your respective income tax rate; over a year - capital gains tax rate.

The UK is simpler, everything (except residential property) is taxed at your respective CGT rate (10% for basic rate and 20% for a higher rate) and your holding period is irrelevant unless we are talking about EIS/SEIS.


Yes you can to claim back US dividend tax but only on paper , practiculy its nearly imposible :smirk: and best i would cost so much money ( what is pointless unless you invest 1 milion pounds ) , time and energy . To claim US tax you allow only if you are in US so you must flight to US flight back, pay for visa wich is so hard to get , loose atleast few weeks of job payment if you lucky , pay rent and all liveing costs in us and in uk … Us special made nearly imposible , expensive and hard to get money back so aboard investors is basically screwed . :face_with_raised_eyebrow:

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A good read! Thank you. It’s a shame you can’t invest into more than one S&S ISA in a year. :joy:

Maybe something like Orca money, but for stocks and shares, would take off…

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I don’t think that would address the issue. The reason you might want to combine different P2P investments is that they are each their own product unavailable on other platforms.
With stocks & shares, the only reason to want to use multiple platforms is different fee structures. The actual investment products will be the same or identical: the different platforms are all offering things on the same stock exchanges.