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Mangement Costs on Managed Funds deductible?

Discussion in 'Accounting, Tax & Legal' started by archangelsupreme, 30th May, 2008.

  1. archangelsupreme

    archangelsupreme Well-Known Member

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    Australia
    Hi,

    Just wondering if the management costs (i.e. the 1-2% management fee on most manage funds) is tax deductible?
     
  2. AsxBroker

    AsxBroker Well-Known Member

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    Sydney, NSW
    Hi ArchAngelSupreme,

    This is usually taken out of the returns before they give the returns to you. Hence, you probably wouldn't be able to claim it.

    I haven't heard of anyone be able to claim it yet (I could be wrong).

    Cheers,

    Dan

    PS I'm not a tax adviser so don't believe what I say. Speak to your accountant or tax adviser before completing your tax return.
     
  3. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Management Fees are taken from the capital of the fund - not from the income.

    Your capital returns are net of fees (the unit price is adjusted on a daily basis to take accrued fees into account).

    There are no deductions against income available.

    You should check the end of year tax statement provided by your fund manager - that will detail all income and capital gains earned, any tax credits, and if applicable, any expenses that can be deducted (but there won't be any).
     
  4. jrc77

    jrc77 Well-Known Member

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    Fees through indirect funds?

    What about management fees charged by indirect funds? Eg. If you have managed funds through E*Trade they charge a 0.66% fee which is taken from your bank account (NOT the fund returns). Does this then make this fee tax deductable?

    Regards,

    JR
     
  5. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    What is the nature of that fee? Is it like a portfolio administration fee?

    I would think that would be deductible.
     
  6. jrc77

    jrc77 Well-Known Member

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    Portfolio Fee

    They call it a "Portfolio Fee".
     
  7. Simon Hampel

    Simon Hampel Co-founder Staff Member

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    Well that does sound deductible to me (your tax advisor would be able to confirm this) - especially if you are paying it directly.