[GNC] Reporting transactions

Fri May 1 06:26:37 EDT 2020

Yes sure that's one perspective and I agree with it, and that's why I have
my SIPP in the same GC file as everything else. I was just noting that the
way contributions are reported (i.e. as expenses eligible for tax rebates,
not as income that is taxed) seems more in line with a
different perspective, that the net worth of a SIPP is independent from
personal net worth. Isn't a business's net worth different from personal
net worth? Isn't it possible to view it both ways?

Ignore me. I'm a novice to GnuCash and naive in economics. I just find it
interesting, learning new concepts as part of learning GnuCash.

On Fri, 1 May 2020 at 10:41, Christopher Lam <christopher.lck at gmail.com>
wrote:

> 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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