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Tax-effective Securitisation

  • Writer: Mark Hamilton
    Mark Hamilton
  • Dec 21, 2024
  • 1 min read

Updated: Dec 31, 2024

Yes!


The Securitisation is tax neutral, so there is no tax when the profits from the underlying asset are paid to the Securitisation, and no tax is withheld when the Securitisation pays the profits to the investor. The only tax is the capital gains tax which the investor pays on their profit when they withdraw their money from the securitisation.

 

While Securitisations are "passively managed" so generally the Securitisation does not make many sales and purchases during the course of the investments, where it does however, these sales are not taxed, i.e. there is capital gains tax deferral. This is in contrast to a trading account, where each sale is taxed, so there is less left over each time to invest in the next purchase.


 
 
 

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