[GNC] Reporting transactions

Fri May 1 07:53:45 EDT 2020

Yes :)

They differ from other brokerage accounts in regulations on tax and on when
and how you can withdraw funds. e.g. when you use it in retirement as your
pension income, withdrawals from the fund into your normal bank account are
taxed as income at the point of withdrawal (again, from a tax perspective,
paying into a SIPP is a business expense, whereas withdrawing from a SIPP
is a taxable income).

But yes, they are brokerage accounts, to be managed as you say.

On Fri, 1 May 2020 at 12:00, Christopher Lam <christopher.lck at gmail.com>
wrote:

> IIUC the SIPP is simply a wrapper around stock-type and cash-type
> investments, so, you'd handle it exactly the same as any Broker and Broker
> investments.
>
> See https://www.gnucash.org/docs/v3/C/gnucash-guide/invest-setup1.html -
> the SIPP wrapper would be the "Brokerage Accounts" asset. You may choose to
> record each stock fluctuation, or (my preference) trust the SIPP statements
> instead.
>
> Annually you'd print a Transaction Report from SIPP account. Or you can
> run a cash flow report, originating from SIPP account and children.
>
> On Fri, 1 May 2020 at 10:26, Ruaraidh Sackville Hamilton <
> ruaraidh.sh at gmail.com> wrote:
>
>> 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?
>>>> > > >
>>>> > > >
>>>> > > >
>>>> > > > --
>>>> > > > Sent from:
>>>> > > http://gnucash.1415818.n4.nabble.com/GnuCash-User-f1415819.html
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>>>> >
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>>>