[GNC] Reporting transactions

Fri May 1 05:41:07 EDT 2020

I wouldn't classify sipp contributions as expense. You'd be incorrectly
reducing your net worth whenever you contribute to it.

On Fri, 1 May 2020, 5:23 pm Ruaraidh Sackville Hamilton, <
ruaraidh.sh at gmail.com> wrote:

> Ah yes you are right! I didn't think of the case where an employer pays
> directly into a SIPP. In that case it is clearly an income. Not in mine.
>
> Conceptually, it might be better thought of as a business expense. The
> business is the SIPP and the government encourages investment in the
> business by giving tax rebates on allowable business expenses. Payments
> into the SIPP are reported in the tax report as expenses rather than as
> income. And a SIPP is not like other assets: I can't sell it or trade it,
> and there are strict rules limiting when and how much income I can take
> from it in retirement. So maybe we should look at the SIPP as its own
> independent entity, with income to the SIPP being expenses to our other
> assets, just as reported in tax reports.
>
> But that seems a theoretical discussion, and we have a sort of pragmatic
> solution that works (even though I have to go outside of GnuCash to
> calculate what to put in the tax form)
>
> Thanks again for enlightening comments!
>
> On Thu, 30 Apr 2020 at 16:30, D. <sunfish62 at yahoo.com> wrote:
>
> > Ah, then yes it's a terminology thing. In my own case, money from my
> > income goes directly into the SIPP as a payroll deduction, so I just
> > transfer from income into the SIPP. It can just as easily go from an
> asset
> > to another asset.
> >
> >
> > -------- Original Message --------
> > From: Ruaraidh Sackville Hamilton <ruaraidh.sh at gmail.com>
> > Sent: Thu Apr 30 19:42:46 GMT+05:30 2020
> > To: "D." <sunfish62 at yahoo.com>
> > Cc: "D. via gnucash-user" <gnucash-user at gnucash.org>
> > Subject: Re: [GNC] Reporting transactions
> >
> > Sorry David, I didn't mean to imply I prefer the second to the first
> > option. I just thought it easier to show by editing one of your versions,
> > and happened to pick the second. I could as easily have picked the first.
> >
> > In my reply I replaced your "Income:Me" with "Assets:my bank account".
> The
> > point is that, when the SIPP is in the same GC file as my other assets,
> the
> > transaction is from one asset (the bank account I used to pay into the
> > SIPP) to another asset (my SIPP). It's not from an income account to the
> > SIPP, so it can't appear in a report of income.
> >
> > If I keep the SIPP in a separate dedicated GC file, then no problem: my
> > contribution appears in the main GC file as an expense against my bank
> > account and as an income in the SIPP GC file. I just wondered if there
> was
> > a way of keeping all assets in one file.
> >
> > Ruaraidh
> >
> > On Thu, 30 Apr 2020 at 14:41, D. <sunfish62 at yahoo.com> wrote:
> >
> > > ???
> > >
> > > Perhaps this is a terminology thing, but aren't you just re-presenting
> > the
> > > second option I gave originally?
> > >
> > > Think of it another way: there are two sources for the funding of your
> > > SIPP: your contribution, and the government's. How you handle your own
> > > contribution depends on your workflow; the government is giving you
> > money,
> > > so that's an income account. I offered two methods of recording that
> > > two-step; yours is a repetition of my second method.
> > >
> > > I personally use the first, since the two events are inextricably
> linked
> > > (the second never happens without the first).
> > >
> > > Or am I missing something?
> > >
> > > David
> > >
> > >
> > > -------- Original Message --------
> > > From: Ruaraidh Sackville Hamilton <ruaraidh.sh at gmail.com>
> > > Sent: Thu Apr 30 17:20:34 GMT+05:30 2020
> > > To: "D." <sunfish62 at yahoo.com>
> > > Cc: Gnucash Users <gnucash-user at gnucash.org>
> > > Subject: Re: [GNC] Reporting transactions
> > >
> > > That covers it if the SIPP is in a separate GC file of its own, where
> my
> > > contribution is an income (and an expense from my bank account in the
> > main
> > > GC file, which I use to fund the contribution).
> > >
> > > But if it's all in one GC file we have
> > >
> > > 01-01-2020 SIPP Contribution   Assets:SIPP  £100
> > > My contribution          Assets:my bank account          £100
> > >
> > > 01-01-2020 SIPP Govt Contribution   Assets:SIPP  £25
> > > Government contribution Income:GovContrib £25
> > >
> > > Am I wrong?
> > >
> > > Ruaraidh
> > >
> > > On Thu, 30 Apr 2020 at 12:33, D. <sunfish62 at yahoo.com> wrote:
> > >
> > > > Set up an independent income account for the government
> contributions:
> > > >
> > > > Income:GovContrib
> > > >
> > > > Then add either a split to your contribution for the government,
> > > >
> > > > 01-01-2020 SIPP Contribution   Assets:SIPP  £125
> > > > My contribution          Income:Me          £100
> > > > Government contribution Income:GovContrib £25
> > > >
> > > > or a separate transaction,
> > > >
> > > > 01-01-2020 SIPP Contribution   Assets:SIPP  £100
> > > > My contribution          Income:Me          £100
> > > >
> > > > 01-01-2020 SIPP Govt Contribution   Assets:SIPP  £25
> > > > Government contribution Income:GovContrib £25
> > > >
> > > > That should cover it, yes?
> > > >
> > > >
> > > >
> > > >
> > > > -------- Original Message --------
> > > > From: Ruaraidh <ruaraidh.sh at gmail.com>
> > > > Sent: Thu Apr 30 15:17:04 GMT+05:30 2020
> > > > To: gnucash-user at gnucash.org
> > > > Subject: [GNC] Reporting transactions
> > > >
> > > > I have another question related to UK tax reporting obligations.
> > > >
> > > > In the UK we can have a type of asset called a SIPP (Self-invested
> > > Personal
> > > > Pension). You pay money into a SIPP with the idea of building up an
> > > income
> > > > for your retirement. The carrot is, you get a tax rebate. For example
> > if
> > > > you
> > > > pay 100 GBP into the SIPP, the government pays in another 25 GBP.
> > > >
> > > > For our annual tax reports, we have to report the total added to the
> > SIPP
> > > > during the tax year: the amount we pay in personally, plus the amount
> > > that
> > > > the government pays in, i.e. 125 GBP in the above example.
> > > >
> > > > This is easy to do if I keep the SIPP in a separate GC book. Then all
> > > > personal contributions and the Government's additional contributions
> > can
> > > be
> > > > put into the same income account. Easy. What's not so good is that
> (a)
> > I
> > > no
> > > > longer have an overview of all assets in one book and (b) to do my
> one
> > > tax
> > > > report I have to do two separate GC tax reports.
> > > >
> > > > Is there a better solution? Either something that allows me to keep
> > > > everything in one book, or a way that allows reports to query two
> > books?
> > > >
> > > >
> > > >
> > > > --
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