Tax centre

Reporting fund status

In broad terms, a ‘reporting fund’ for UK tax purposes is an offshore fund that meets certain upfront and annual reporting requirements to Her Majesty’s Revenue and Customs (HMRC) and its investors. Such annual duties will include calculating and reporting the income returns of the reporting share class for each reporting period on a per-share basis to all relevant investors. UK investors who hold their interests at the end of the reporting period, to which the reported income relates, will be subject to income tax or corporation tax on the higher of any cash distribution paid and the full reported amount. The reported income will be deemed to arise to UK investors six months after the reporting period.

As a general rule, each Capital Group Luxembourg fund and their respective sub-funds intend to obtain reporting fund status for the following share classes for every period of account ("reporting period") that they are available and active:

C, L, P, S, Z, ZL and their equivalent distributing share classes (d and gd) in GBP, EUR, USD and CHF. The equivalent hedged share classes of the above listed share classes in GBP, EUR, USD and CHF (for C only those that are hedged back into GBP). For Capital Group Japan Equity Fund (LUX) it will also be sought in JPY. Other specific classes may be added as required by UK investors.

B, BL and their equivalent distributing share classes (d and gd) in GBP, EUR, USD and CHF (in addition to JPY for Capital Group Japan Equity Fund (LUX)), as well as the equivalent hedged share classes in GBP, EUR, USD and CHF (in addition to JPY for Capital Group Japan Equity Fund (LUX)), will continue to benefit from UK reporting fund status for investments made prior to 30 September 2024.

The investor tax report will be made available on the website here in the Tax centre, within the six months following the end of the reporting period. However, if you require this information in writing, please contact Capital Group's IST Client Operations Team on +41 22 807 4800, or, if you are an institutional client, your Relationship Manager. Alternatively, you can email us.

The investor tax reports are published for each reporting share class for each reporting period. They comprise the "distributions" per share made by the fund during the period, as well as the "excess reportable income" per share at the end of the reporting period. The excess reportable income is broadly based on the net income of the fund in excess of distributions made during the reporting period. UK investors must include both the actual distributions received, as well as the excess of reportable income in their tax returns on which they will be liable to pay income or corporation tax as appropriate.

On disposal of an interest in a reporting fund share class, a UK individual investor will be subject to capital gains tax on any gain/loss providing that the share class in question had been a reporting share class for the entire period of investment. However, any gain on disposal by a UK individual investor of an interest in a non-reporting share class will be treated as income for UK tax purposes and therefore subject to income tax. For UK corporate investors, disposals of interests in reporting funds will be treated as chargeable gains and disposals in non-reporting funds will be treated as taxable income.
Calculation of the reportable income for the tax return

In order to determine the actual distribution received, the UK investors should multiply the number of shares that they held as at each distribution date by the corresponding distribution amount per share provided in the investor tax report. Alternatively, investors can refer to the dividend vouchers they received in the course of the reporting period.

In order to calculate their excess reportable income, the UK investors should multiply the number of shares they held as at the end of the reporting period by the excess of reportable income per share as provided in the investor tax report.

The distributions per share and excess of reportable income per share amounts are provided in the base currency of the fund, as specified at the top of the investor tax report. UK investors should apply an appropriate exchange rate to convert these figures to GBP.

The "reportable income" should be recognized in the tax return as a distribution that arose on the reporting period end date plus six months. The reportable income is treated as an additional taxable distribution received by the investors.

We have set out below an example for an investor who received two distributions and excess reportable income:

Example

Date

Number of shares

Amount USD

F/X USD to GBP

Distribution 1 30-Jun 100 1.00 0.60
Distribution 2 31-Dec 100 1.00 0.60
Excess reportable income 30-Jun 100 0.50 0.60

Calculation of total reportable income

Amount (GBP)

Working

Excess reportable income 30 = 100 * 0.50 USD * 0.60
Dividend Income 120 = 100 * (1 USD + 1 USD) * 0.60
Total taxable income 150 = 30 + 120

	Date	Number of shares	Amount USD	F/X USD to GBP
Distribution 1	30-Jun	100	1.00	0.60
Distribution 2	31-Dec	100	1.00	0.60
Excess reportable income	30-Jun	100	0.50	0.60

	Amount (GBP)	Working
Excess reportable income	30	= 100 * 0.50 USD * 0.60
Dividend Income	120	= 100 * (1 USD + 1 USD) * 0.60
Total taxable income	150	= 30 + 120

Income Equalization

Each Capital Group Luxembourg fund operates full equalization. This enables the investors to be taxed on the appropriate level of income that they have earned during the period. To make adjustments for the income equalization purchased, investors will require the daily income equalization rate (IER).

The IER is available at share class level. It corresponds to the net income per share earned from the beginning of the reporting period to the date the shares are purchased. It is provided in the IER report, available on the website here in the Tax centre, and expressed in the base currency of the fund.

The IER is relevant to the shareholders who have subscribed for shares in the course of the reporting period. For those new investors or existing investors making additional investments into the fund, the total income equalization (equal to the IER as at the date of the subscription multiplied by the number of shares subscribed) can be deducted from the total reportable income and any distributions. Investors can choose whether to offset the IER against their excess reportable income or distributions (in any order) until the IER is fully utilized.

In our example above, let's assume that out of 100 shares, 40 were subscribed at the end of the 4th month of the accounting period and the investor has decided to deduct the IER against their excess reportable income first. The IER as at the date of subscription was 0.8 USD / share.

	Amount (GBP)	Working
Total Income Equalisation	19.2	= 40 * 0.8 USD * 0.60
Excess reportable income	10.8	= (100 * 0.50 USD) * 0.60 - 19.2
Dividend Income	120	= 100 * (1 USD + 1 USD) * 0.60
Total taxable income	130.8	= 10.8 + 120

Note that if the total income equalization amount is greater than the excess reportable income, the excess reportable income will be reduced to zero. The balance of equalization not netted against the excess reportable income can further be offset against any dividend income.

In a variation of the example above, let's assume that out of 100 shares, 80 were subscribed at the end of the 4th month of the accounting period. The IER as at the date of subscription was 0.8 USD / share.

	Amount (GBP)	Working
Total Income Equalisation	38.4	= 80 * 0.8 USD * 0.60
Excess reportable income	-	= (100 * 0.50 USD) * 0.60 - 30 = 30 -30
Dividend Income	111.6	= 100 * (1 USD + 1 USD) * 0.60 - (38.4 - 30) = 120 - 8.4
Total taxable income	111.6	= 0 + 111.6

Dividend distributions and excess of reportable income from bond funds
Under UK tax rules, funds which hold more than 60% of their assets (by market value) in interest bearing securities at any time during an accounting period will be considered as "bond" funds, and the reportable income from these funds (cash distributions and excess of reportable income) will be treated as payment of interest in the hands of UK taxable investors rather than dividends. Accordingly, for UK resident individual investors such distributions will be subject to tax at the rates applying to interest. Whilst for UK resident corporate investors, such distributions would be deemed to be “loan relationship” for UK corporation tax purposes.

For the current reporting period, the list of Capital Group funds that are classified as a 'bond' fund is as follows:

Capital Group Emerging Markets Debt Fund (LUX)

Capital Group Emerging Markets Local Currency Debt Fund (LUX)

Capital Group Euro Bond Fund (LUX)

Capital Group Global Bond Fund (LUX)

Capital Group Global Corporate Bond Fund (LUX)

Capital Group Global High Income Opportunities (LUX)

Capital Group Global Intermediate Bond Fund (LUX)

Capital Group Global Total Return Bond Fund (LUX)

Capital Group US Corporate Bond Fund (LUX)

Capital Group US High Yield Fund ( LUX)

Capital Group Multi-Sector Income Fund (LUX)

Capital Group Future Generations Global Corporate Bond Fund (LUX)

Capital Group - UK Tax Strategy

To download a copy of Capital Group's UK Tax Strategy please click the below button.

DOWNLOAD

Income deemed distributed in Tax Year

Umbrella	IER report (year ended)
Capital International Fund (CIF)	31 Dec 24

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 23	31 Dec 23

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 22	31 Dec 22

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 21	31 Dec 21

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 20	31 Dec 20

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 19	31 Dec 19

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Fund (CIF)	31 Dec 18	31 Dec 18

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Portfolios (CIP)	31 Mar 19	31 Mar 19
	31 May 19	31 May 19

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital Group Emerging Markets Growth Fund (LUX) (CGEMGLU)	28 June 19	28 June 19

2018/2019

Umbrella	Investor tax report (year ended)	IER report (year ended)
Information pertaining to Capital Group Global Absolute Income Grower Fund (Lux) as at Merger Date 21 September 2018 into Capital Group Capital Income Builder (Lux)	21 Sep 18	21 Sep 18
Capital International Fund (CIF)	31 Dec 17	31 Dec 17

Funds
Capital Group AMCAP Fund (LUX)
Capital Group US Corporate Bond Fund (LUX)
Capital Group US High Yield Fund (LUX)
Capital Group Global Equity Fund (LUX)
Capital Group Japan Equity Fund (LUX)
Capital Group World Dividend Growers (LUX)
Capital Group Global Growth and Income Fund (LUX)
Capital Group European Growth and Income Fund (LUX)
Capital Group Global Allocation Fund (LUX)
Capital Group Global High Income Opportunities (LUX)
Capital Group Global Bond Fund (LUX)
Capital Group Euro Bond Fund (LUX)
Capital Group Euro Corporate Bond Fund (LUX)
Capital Group New Perspective Fund (LUX)
Capital Group Global Absolute Income Grower (LUX)
Capital Group Investment Company of America (LUX)
Capital Group New World Fund (LUX)

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital International Portfolios (CIP)	31 Mar 18	31 Mar 18

Funds
Capital Group Emerging Markets Debt Fund (LUX)
Capital Group Emerging Markets Total Opportunities (LUX)
Capital Group Emerging Markets Local Currency Debt Fund (LUX)

Umbrella	Investor tax report (year ended)	IER report (year ended)
Capital Group Emerging Markets Growth Fund (LUX) (CGEMGLU)	30 Jun 18	30 Jun 18

Funds
Capital Group Emerging Markets Growth Fund (LUX)

Tax considerations for UK Taxable residents

In light of the recent merger of Capital International Portfolios into Capital International Fund with an effective date of 31 May 2019 (“Effective Date”), please find following information pertinent to the tax impact this activity has on your investment if you are a UK taxable resident.

The CIP sub-funds merged into the corresponding CIF sub-funds are described below:

Absorbed Sub-Funds under the Capital International Portfolios (“CIP”) umbrella	Absorbing Sub-Funds under the Capital International Fund (“CIF”) umbrella
Capital Group Emerging Markets Debt Fund (LUX)	Capital Group Emerging Markets Debt Fund (LUX)
Capital Group Emerging Markets Local Currency Debt Fund (LUX)	Capital Group Emerging Markets Local Currency Debt Fund (LUX)
Capital Group Emerging Markets Total Opportunities (LUX)	Capital Group Emerging Markets Total Opportunities (LUX)

Please be informed that roll over relief is available on shares you acquired as a result of the merger, that is to say, the aforementioned merger will not be considered a taxable event.

This treatment is a consequence of the way the merger has taken place and because HMRC has acknowledged the merger as being for bona fide commercial reasons.

This means you are not expected to calculate and report capital gains in regards to the merger on your annual tax return.

The above should not be considered as constituting legal or tax advice. You are encouraged to seek assistance of an independent financial professional or tax adviser for your personal tax situation.

If you have any questions or comments, please contact the Investor Services Team by telephone on +41 22 807 4800, or by email at Client_Operations@capgroup.com and we will be pleased to assist you.

In light of the recent merger of Capital Group Emerging Markets Growth Fund (LUX) into Capital International Fund with an effective date of 28 June 2019 (“Effective Date”), please find following information pertinent to the tax impact this activity has on your investment if you are a UK taxable resident.

Please be informed that roll over relief is available on shares you acquired as a result of the merger, that is to say, the aforementioned merger will not be considered a taxable event.

This treatment is a consequence of the way the merger has taken place and because HMRC has acknowledged the merger as being for bona fide commercial reasons.

This means you are not expected to calculate and report capital gains in regards to the merger on your annual tax return.

The above should not be considered as constituting legal or tax advice. You are encouraged to seek assistance of an independent financial professional or tax adviser for your personal tax situation.

If you have any questions or comments, please contact the Investor Services Team by telephone on +41 22 807 4800, or by email at Client_Operations@capgroup.com and we will be pleased to assist you.

In light of the recent merger of Capital Group Global Growth and Income Fund (LUX) into Capital Group World Growth and Income (LUX) with an effective date of 27 September 2019 (“Effective Date”), please find following information pertinent to the tax impact this activity has on your investment if you are a UK taxable resident.

Please be informed that roll over relief is available on shares you acquired as a result of the merger, that is to say, the aforementioned merger will not be considered a taxable event.

This treatment is a consequence of the way the merger has taken place and because HMRC has acknowledged the merger as being for bona fide commercial reasons.

This means you are not expected to calculate and report capital gains in regards to the merger on your annual tax return.

The above should not be considered as constituting legal or tax advice. You are encouraged to seek assistance of an independent financial professional or tax adviser for your personal tax situation.

If you have any questions or comments, please contact the Investor Services Team by telephone on +41 22 807 4800, or by email at Client_Operations@capgroup.com and we will be pleased to assist you.

The information contained on this page does not constitute investment or tax advice and does not purport to deal with all of the tax consequences applicable to the funds or to all categories of investors, some of whom may be subject to special rules. Shareholders and potential investors are advised to consult their professional advisors concerning possible taxation or other consequences of purchasing, holding, selling, converting or otherwise disposing of the Shares under the laws of their country of incorporation, establishment, residence, or domicile, and in the light of their particular circumstances.

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Tax centre

Capital Group - UK Tax Strategy

To download a copy of Capital Group's UK Tax Strategy please click the below button.

Income deemed distributed in Tax Year

Umbrella

IER report (year ended)

Tax considerations for UK Taxable residents

Further to the merger of Capital International Portfolios (“CIP”) into Capital International Fund (“CIF”)

Further to the merger of Capital Group Emerging Markets Growth Fund (LUX) into Capital International Fund (“CIF”)

Further to the merger of Capital Group Global Growth and Income Fund (LUX) into Capital Group World Growth and Income (LUX)

IER report
(year ended)