How to enter Return of Capital in ledger-cli

Question

Some background first: I'm using GnuCash for personal finances and am trying to get some reports from ledger-cli. The data is exported using piecash from GnuCash into a ledger file.

When running ledger, it reports the error for the Return of Capital, which was entered as recommended for GnuCash:

> 2014/07/18 return of capital
>   Assets:Investments:Broker:Cash                 959.52 AUD
>   Trading:ASX:IPE                       0.0000 IPE @@ 959.52 AUD
>   Assets:Investments:Broker:Shares:IPE  0.0000 IPE @@ 959.52 AUD
>   Trading:CURRENCY:AUD                          -959.52 AUD
Unbalanced remainder is:
         1919.04 AUD
Amount to balance against:
          959.52 AUD
Error: Transaction does not balance

I see that both, the amount in the cash account and the amount in the share account are positive. The trading accounts balance. What would be the correct way to write these transactions for ledger-cli?

This is a general question on how people track Return of Capital events in ledger-cli, or generally in any double-entry bookkeeping system. Note that the usage of Selinger's multi-currency system also applies (in this case with the use of Trading accounts).

The resulting reporting should indicate that this is not taxable income but a reduction of investment value and transfer to cash.

Answer 1

You can model the return of capital like this:

2000-01-01 * Bought IPE
   Assets:Investments:Broker:Shares:IPE    100 IPE {10.00 USD} [2000-01-01] @ 10.00 USD
   Assets:Investments:Broker:Cash             -1000.00 USD

2019-04-01 * Return of capital
   Assets:Investments:Broker:Cash             500.00 USD
   Assets:Investments:Broker:Shares:IPE    100 IPE { 5.00 USD} [2000-01-01] @ 5.00 USD
   Assets:Investments:Broker:Shares:IPE   -100 IPE {10.00 USD} [2000-01-01] @ 5.00 USD

The only thing I'm not sure if the 2nd posting should have a date of 2000-01-01 or 2019-04-01 but I think that's mostly a tax question. Since the return of capital is no taxable event, I think it should be the original purchase price.