Fractional shares in an ISA

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21

Will have to see how low tax receipts are in that quarter.

22

Seems a bit unfair with regards to stock splits and spin offs and suchlike, when one day you have a nice friendly 2 shares and the next you have 3.36475858558 because you haven’t kept up with the corporate event calendar.

23

You all seem remarkably calm about this! This is opening a very horrible can of worms, especially for those that have been regularly trading within an ISA.

For the most part, I’m just holding long positions in my ISA, but the vast majority are fractional holdings. If HMRC decide fractional shares aren’t allowed in ISAs, that’s going to seriously f*ck with my investing. It’s a truly horrible idea!

Would be nice to hear an official line from Trading212 on this.

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24

It is one article in a newspaper. We’ve had similar hoo haa with some YouTube videos that turned out to be sprouting crap as well, although this might be more legit, but still in my opinion it is incorrect. I would rather 212 continue to work on new features, and only give an official response if there was actually a potential concern here.

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25

write to your MP and complain highlighting that it is counter productive (discourages investment) and is discriminatory (rich people are able to trade in whole shares priced in £hundreds whereas less affluent people can’t necessarily do so) and the legislation says nothing about fractional shares so it is basically a case of HRMC making the rules up as they go along (as far as I can tell bwdik)

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26

In other words, doing what they are best at. Being crooked!

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27

As far as I’m concerned a share of a share is a share

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28

Conspiracy theory on:

Maybe the article was requested or “leaked” by some big bank or broker to create FUD on the fractional shares retail investors in the neobanks and neobrokers or lobbying against fractional shares hitting the neobanks and neobrokers.

Conspiracy theory off.

Or just, simple answers:

  • click bait news article or
  • iliteracy/ignorance.

Or ultimate answer, the newspaper has requested some “AI” software to write an article about fractional shares and ISA.

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29

You’ll be pretty close tbh. The Telegraph is owned by the Barclay brothers and is very much the mouthpiece of the elites.

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30

Only one brother remains as owner. David Barclay died in 2021. The Telegraph Media Group is currently up for sale and in dispute with Lloyds Bank over debts.

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31

@Bogi.H Hiya, just wondering if anything official from 212 is available on this? What’s your thoughts? Cheers

32

Yes, one article containing a statement obtained directly from HMRC: “In a statement, HMRC confirmed to The Telegraph that it was the tax office’s view that trading platforms were breaking the rules by putting fractional shares in ISAs”

33

I don’t know how (tax) legislation works in UK, but “tax office’s view” not means the same as tax legislation. And unless its written in the law, opinions/views are just that.

HMRC or other public offices must do an official statement and even then, it can be contested. Not everything politicians or public institutions do or say are engraved in stone or are legal.

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35

Yes, I mostly agree. However, given that HMRC are the ones that enforce tax-related laws, them saying that fractional shares aren’t allowed is somewhat… problematic.

36

Thing is at the moment we don’t know if they spoke to someone in senior leadership or the dude who sorts the bins. Until we do, I’d sit tight, personally.

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37

The way they phrased it “statement from HMRC”, rather than “we spoke to someone at HMRC who wishes to remain anonymous and they said …”, implies that they got this from someone who really should know what they are talking about/is in a position to be able to state what the “official” line is.

I’m not panicking (i.e., I’m not selling any fractional holdings), but I’m not relaxed and happy either.

38

What happens if your holding were fractional at one point in time, bit not anymore.

Let’s say someone bought 0.25 shares every month and now has 2 full shares in an ISA.

I haven’t heard anything until now and it seems interesting to say the least when only freetrade seems to have been mentioned, yet both 212 and invest engine offer fractionals.

Also I think the vanguard platform does also.

And that doesn’t even mention mutual funds either.

39

If they’re so confident I’m certain they would pop their name on the record, which they didn’t.

40

It makes sense, it is called “stocks and shares ISA” and not “fractional stocks and fractional shares ISA”. :smiley:

Maybe it was the HMRC “AI”/chatbot? It knows the wording diference between share and fractional share, but don’t understand the reality.

Btw, a chatbot text/dialog is legally binding?

In my country, public/government services announced that they will use "AI/chatbots for “customer” support. It will be interesting asking things and get weird answers, maybe it would won’t be worst than the public servants answers :slight_smile:.

41

a fractional share is a share of the underlying company. it is still a share