A share savings account will enable private investors to trade shares and equity funds without triggering capital gains tax, for as long as the value of the sales is kept in the account. That means, it is for example possible to sell equity funds with gains and reinvest the entire amount in another equity fund.
These are some of the benefits for those saving in shares and equity funds
- Deferred tax on gains from the sale of shares and equity funds while the value of sales is kept in the account. Any losses may be deducted from accrued gains within the account.
- Withdrawals from the account adding up to the total of holdings and the Norwegian accumulated “skjermingsfradrag” are exempt from tax. Only withdrawals of gains are taxable.
- During 2017, you will be able to reallocate all holdings of shares and share funds together with unrealised capital gains to the share savings account without triggering taxation.
VPS account = share savings account
A VPS account is the natural basis for a share savings account. Adjusted current services will allow VPS to facilitate the opening of a share savings account and the migration of current shares and equity funds. VPS will prepare for a high degree of self-service for shareholders and fund unitholders in VPS Client Services or in other providers’ solutions. VPS will provide migration functionality In VPS Client Services that allows the investor on a self-service basis to transfer shares and equity funds from his or her existing VPS account to the share savings account.
VPS’ solutions
In the service offering to our clients, VPS has emphasised simple and efficient solutions with a high degree of reusing of the existing systems and processes. By combining existing solutions, VPS can rapidly deliver functionality for share savings account to the providers thereof at modest one-off costs and with low risk.
To enable funds that are currently not registered with VPS to be included in the investors’ share savings accounts, in line with other VPS registered securities, VPS is now expanding the services for VPS registration. VPS is going to offer partial registration of funds that will continue to have its principal register outside VPS.
To the fund distributors that will offer Norwegian and European equity funds within one share savings account, the existing VPS nominee system will be an efficient solution. VPS Nominee Register can include both fund units to be included in a share savings account and those that are not included. Together with an ordinary share savings account, the VPS Nominee Register solution will give the distributors the opportunity to offer their clients a wide range of products.
Providers of share savings will be responsible for the calculation of taxes and related reporting to the tax authorities. VPS has extensive experience within tax reporting, both related to funds and shares, and we have a close and good relationship with the Norwegian Tax Administration. Together with the existing solutions for tax reporting, VPS will be well positioned to deliver a service for the calculation of taxes and reporting of taxes. We will in this connection be able to provide calculation of taxes and reporting for a share savings account that includes both shares and equity funds, cash accounts and any other securities that are not held in a VPS account.