CSH2 Excess reportable income

I am looking at CSH2 as a place to put some cash, LYXOR SMART CASH UCITS ETF. This is a low risk accumulating ETF that returns money market rates and holders on 31 October accrue liability for excess reportable income (ERI) which is taxed at income tax rates. Since it is a reporting fund, sales of the fund attract tax only at capital gains tax rates. I am trying to find on the Amundi website where ERI might be listed. But I cannot find it. Can anyone help? LU1230136894 | Lyxor Smart Overnight Return - UCITS ETF C-GBP

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I can’t really help but, out of interest, presumably ERI only applies if it’s held outside a Sipp/Isa?

One of the reasons I avoid Amundi/Lyxor is a comparative lack of information sometimes. Plus some of their ETFs are domilied in France which can have withholding tax implications.

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That would be right. ERI is only an issue if held in a taxable account. CSH2 is domiciled in Luxembourg.

Unless I misunderstand, I can sell just before October 31 and rebuy shortly afterwards, hence avoiding income taxable ERI. The gains will then be subject only to 10% or 20% CGT rather than income tax rates of 20% 40% or 45%. Of course one will have to do the work of computing the capital gains and loss correctly. A sell on October 27 and rebuy November 1 will create a capital loss since the sale will be matched to the higher repurchase price. I have sent an email to Amundi to ask where to find the ERI information.


It’s a great question and I want to find out myself too as I have a lot in CSH2 outside ISA.

From what I understand it needs to be classified as a reportable fund by HMRC to declare ERI and there is a list given by HMRC here, but I don’t see CSH2 here so that confuses me.

I will continue to research this, in any case I’m sure a huge amount of cash is needed in this fund to have any income that would be significant

It does have UK Reporting Fund status. But I read someone saying on Reddit that Amundi does not publish the ERI information. You have to request it.

I found this page, where some ERI are given but not for CSH2

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I had a reply from Amundi. You find the ERI for CSH2 (LU1230136894) on this webpage.

It requires registration, which is easy to do. Oddly, to my thinking, the ERI shown for 31 October 2022 is 0.

This is on the page


If ERI is zero then the only taxes I will incur through holding the fund are capital gains tax (at 20% tax rate), but with no income tax on any ERI (40% tax rate). Usually with accumulation ETFs such as CSH2 (LU1230136894) there is some excess reportable income. So I am surprised.

However, some past years do show an ERI. Here for holders at 31 October 2016:


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Thanks that’s great information. Wouldn’t we be interested in October 2023 though? does it have that ERI yet?

The fund distribution date is the following 30 April, deemed to occur six months after the end of the reporting period, which is at 31 October.

So the ERI of 31/10/23 will be reported 30/04/24 and taxable in the UK tax year 2024-25. If you had held the fund on 31 October 2022 then the first screenshot above shows that there is no ERI to declare for the 2023-24 UK tax year.

Unfortunately, there is no way to know what ERI will be declared at the approaching 31 October 2023. We will only learn that sometime after.


No way to know accurately, but you should be able to make some rough guesstimates based on previous years and the performance ETF rate during those years.

My guess is there won’t be a free lunch. Where the fund is earning money as interest that will be ERI. Looking at your 2016 figure, looks like the ERI was 0.25% and the fund performance was 0.6%. So maybe ~1/3. What are the 2022 figures? Fund performance was in the 3.5% range, what was the ERI?

Currently at ETF rate is ~8.5%. If only a 1/3 of that is taxable, its better performing than keeping that money as cash earning interest (is it just as safe as cash??) and probably a lot less hassle than managing your own bond holdings. Maybe a good place to hold cash if you’re sitting out of the market for a while.

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I use it like you say to hold cash that I need in the near future.

How did you find 8.5% by the way? I thought CSH2 basically tracks SONIA which is about 5% right now from this chart


The performance graph of the fund page, hover over the last few days, the ETF is at 8.77% and the benchmark is showing at 5%.

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Oh I see that’s interesting. Not sure how to read those charts as if you click YTD chart on that page it says ETF is 3.51% at the moment which seems more accurate to me (look at YTD for CSH2 in Google finance).

That’s the difference between the last 12 months and current daily at annual rates. So right now the price should be increasing by close to 8.7% / 365 (or however many counting days there are in a year) each day.

I’m not familiar with CSH2, but I do use QUID and JGST. Both of their trailing annual returns are around 3.5%. Latest month performance is over 5% on an annualised basis.

[ makes CSH2 seem very attractive in comparison. Are the risks the same? - need to figure that out. ]

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I would like to think that 8.7% is current rate but looking at it again I understand that 8.7% is the increase from 2015 (start date of CSH2) and now. Google finance confirms this. It certainly is not going at 8.7% a year pace. It’s currently around 0.4% per month I would say is a good estimate.

CSH2 has increased 1.3% over the last 3 months, which would make 5.2% per year. This is consistent with current SONIA.

As this can be achieved with only capital gains tax rates liability, and with the possibility to offset losses, I would consider it attractive. The only difficulty in a taxable account is the accounting work that will need to be done if repurchase occur within 30 days of a sale.

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agree with this, it’s interesting as investors are looking at CSH2 and trying to work out how much the yearly interest rate is but that is it not possible to find exactly as it’s tracking a moving SONIA index which could rise or fall in the future, who knows what the SONIA rate will be in 1,2,5 years time. This is why CSH2 is seen as a short term investment to hold cash before investing rather than something you want to hold and try and guarantee some type of yearly return.

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Because of the buy,/sell spread the holding period need to be a few days if one is to do better than holding money in a bank instant access account. The spread is about 0.02%, so I figure that is 2-3 days worth of average gain.


You’re right, my bad!

So it’s running about the same as the two I mentioned, possibly with a tax advantage if held in a non tax protected account.


Here are some historical ERI statistics for CSH2.

11/2017-10/2018 (distribution date 30/4/2019): £4.3959/unit (price then: about £1024, so 0.43%)

30/4/2020: £6.5820 = 0.64%

30/4/2021: £2.3578 = 0.23%

But for subsequent years I notice

2022 and 2023: £0 ERI.

I wonder if this ETF is now structured and managed so that going forward since 2022 the ERI is expected to always be 0. If so, that is advantageous for those who would like money market returns taxed as capital gains rather than at income tax rates. The next ERI report will be made 30/04/2024.

Personally, when I report additional income it is taxed at 40%, but also shifts an equivalent value of dividends into a higher tax bracket, so effective rate is 45.6%. But capital gains tax rate is 20%.

Interesting point. Am I right in thinking that if the gains are all capital gains then tax can be controlled by not selling rather than income which is just taxed like interest?

The reason I wonder this is going into 2024 Trading 212 will offer 4.5% interest (GBP) on uninvested cash so the question will be - why bother with buying CSH2 at all when I can get 4.5% anyway?

The answer I can think of to that is if all CSH2 gains are capital gains then you can control the gain by only selling what you need to and stay under capital gains tax bracket. If CSH2 payments are income then I don’t think there is any advantage buying CSH2?