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Capital gains reporting is a crucial part of any investment process, yet capital gains calculation itself can be challenging. However, the process can be simplified with the use of historical data. Historical data on investments can span decades from the inception of a holding through name changes, stock splits, mergers, de-mergers and all the various events relevant to an investment holding. Having accurate and up-to-date data at hand is vital to ensure the correct calculation of any capital gains liabilities on disposal.
The Benefits of Historical Data
Firstly, historical data that charts the values of holdings enables the accurate calculation of any capital gain at the point of disposal. Although this is ultimately dependent on the availability and accuracy of the data being loaded, it supports accurate, reliable, and auditable calculation of the current book cost of the holding.
Another major benefit of full historic transaction data is that it facilitates the appropriate and correct corporate action application throughout the lifetime of the holding. This can also impact the calculation of the holding’s book cost.
The alternative to historical data is to use an agreed take on value at a point in time. However, the main drawback of this method is that it relies on an off-platform calculation. This is not easily auditable and traceable in the future.
The most accurate, reliable and auditable means of capital gains calculation is therefore the use of historical data.
FSL’s CGiX Software offers comprehensive historical data that supports the accuracy of your CGT reporting. CGiX’s calculation engine also incorporates capital event histories since 1982, general rules since 1995, and UK CGT legislation since 1965, ensuring that calculations have adapted to changing tax rules and legislation. The Offshore Reporting Funds (ORF) Service also provides historic fund data to ensure the process of calculating taxable income is smooth and accurate.