Accrued interest in the tax base
Accrued interest paid at purchase reduces the tax base; accrued interest received on a sale increases it.
How to read the number
The mechanism prevents one coupon being taxed twice: whoever held the bond for part of the period pays only on their part of it.
When the metric lies
Treatment differs depending on whether the bond was sold or held to redemption, and on whether both operations went through one broker. Transferring bonds between brokers without proof of acquisition cost turns the whole amount into income.
Also known as: accrued interest for tax purposes