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I am an italian citizen but UK resident and have an investment account with Fidelity in UK. I would like to invest in the Fidelity Euro Cash fund to gain exposure to EUR without adding other risks (e.g. equity or bond). The fund is:

https://www.fidelity.co.uk/investor/research-funds/fund-supermarket/factsheet/performance.page?idtype=ISIN&fundid=LU0346390353&UserChannel=Direct

This fund is offshore so do you know what are my tax obligations and deadlines? Suppose I invest on this fund at the beginning of February when should I declare any capital gain and interest in my tax return? And how does this work in practice (any description of the process and reference to external sources is very welcome).

So far I have only invested in ISA but unfortunately I cannot hold this fund in my ISA cause it is not GBP denominated.

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  • Are you a U.K. resident or citizen? If so, please edit your question to specify the 'united-kingdom' tag.
    – Chris W. Rea
    Commented Jan 6, 2015 at 2:48
  • Thank you. Just edited the question. I am italian citizen but resident in UK.
    – mickG
    Commented Jan 6, 2015 at 7:48

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Fidelity's Euro Cash Fund (ISIN LU0346390353, as you linked) is an "approved offshore reporting fund" (see row 17437 on the current version of that spreadsheet, or just Ctrl+F that ISIN). This means that the gains will be reported to HMRC and you will be taxed on those gains as Capital Gains (as opposed to Income, which would be the case were the fund not a reporting fund).

The fund is an "accumulator", which means that you will need to pay taxes on it even though it won't actually distribute the gains (they are automatically reinvested). The necessary information for doing so is contained in Fidelity's Reporting Funds-UK Tax Guide.

Note that if your total annual capital gains are below your annual allowance (currently £11,700) and your total disposal proceeds are less than 4x the annual allowance, and you don't need to report for any other reasons, you won't need to report or pay. The tax year runs from April 6 to April 5, and the deadlines depend on how you file and pay: HMRC deadlines page

HMRC's website is very helpful (unlike other countries, cough US cough) and you should be able to find detailed instructions on https://www.gov.uk/self-assessment-tax-returns and https://www.gov.uk/capital-gains-tax/report-and-pay-capital-gains-tax

If you are domiciled in the UK for tax purposes, your Italian citizenship is irrelevant.

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