Capital Gearing Share Discussion Threads

[stevi111] 19/12/2011 00:02

Thank You Miata :-)

[miata] 18/12/2011 20:24

You can include the loss (if any) between the market value at the date of transfer out of the ISA and the ultimate sale proceeds.

The original cost and any loss you made whilst the shares were in the ISA are not relevant to working out allowable losses.

[stevi111] 18/12/2011 19:55

Bought £6k worth of shares in a 'stocks n shares' ISA a few years ago.....

Then closed the ISA down completely and transferred those shares into a normal sharedealing account. Sell the shares couple of years later for a pittance £500 meaning a £5,500 loss.

Can I include the losses made here alongside other 'share deals' when working out CGT gains / losses ??

Thanks.

[gengulphus] 18/12/2011 19:49

2Toadstool,

I just have a simple question.I buy and sell shares in one company at various times during the year and I have zero shares in this company by the year end ,a I know what the overall gain or loss is for my purchases in this company.Can I simply input the whole of these transaction in Cgt calculator.

Like MIATA, I'm not certain exactly what you're asking... My best guess is that it's whether, in those circumstances, you can save work by giving the CGT calculator the combined effect of all of your trades during the year (i.e. you got rid of all of the shares that you started the year with, for the cash you received for the sales minus the cash you spent on the buys) as though it were a single trade - instead of inputting the details of all of the separate trades.

As long as you have 30 clear days after the sale that brings you down to zero shares, i.e. that you don't buy the shares again until at least the 31st day after that sale, the difference between the gains and the losses that you calculate that way will be correct. That difference is the basic thing CGT taxes you on, so as a first approximation it gets the tax right.

But I'm afraid that the CGT rules aren't that simple, and it can backfire on you in various ways due to the details of the rules. Some examples:

* Doing things that way, the calculator tells you that you have £10k gains for the year and no losses. You check the rules for having to submit the Capital Gains Summary pages and your computations - gains before deducting losses are below the allowance, disposal proceeds are below 4 times it, and you don't want to make a claim or election. So you don't have to submit them - hurray!

Except that if the computations had been done working from the full trade record, perhaps they would have come out as £12k gains and £2k losses. Same net £10k gains, but now the gains before deducting losses are over the allowance, so you do actually have to submit them...

* It assumes that you're allowed to offset the losses against the gains, to make only the net gains count. There are some circumstances in which you're not allowed to do that - e.g. £10k net gains might look to be within the allowance, but if it's actually £15k gains and £5k losses, with the losses "clogged" because you realised them on a disposal to a "connected person", you might have to pay CGT after all.

* It assumes that you want to offset the losses against gains realised on the same share. Sometimes you don't - e.g. if last tax year you realised both gains and losses on the same share before the Budget, and gains on other shares after the Budget, you may well want to offset the losses against the gains on the other shares to save yourself 28% CGT rather than against gains on the same shares that will only save you 18% CGT.

Gengulphus

[miata] 16/12/2011 19:55

Not sure what you mean by 'the whole of these transaction' but provided you mean each individual transaction rather than the totals for the year you should be OK.
The calculator should sort out the problems where you have re-bought within 30 days.

[2toadstool] 16/12/2011 17:33

Firstly I'm sorry if I'm posting on the wrong thread ,I can't seem to acess the main cgt thread.

I just have a simple question.I buy and sell shares in one company at various times during the year and I have zero shares in this company by the year end ,a I know what the overall gain or loss is for my purchases in this company.Can I simply input the whole of these transaction in Cgt calculator.

My manual calculations and cgt calculations are the same ,in terms of overall gain/loss but cgt calculator will also give more info for completing the other sections...

Hope that makes sense ,I simply struggle to get my head around some of these rules,so long as I input everything into cgt cal and extract all the figures is that ok....

Hope someone can help.

Ps this is a great thread.

[scarymonster] 08/12/2011 18:04

Thanks MIATA for your speedy advice, I'll have a look at the format I'm feeding the converter and see if I can get it to tally up properly. If that fails I'll add them manually.

[miata] 08/12/2011 18:00

Commission should be included in the total cost of each trade.

[scarymonster] 08/12/2011 17:51

Hi chaps, I used the stonebanks converter to change my format from cgtcalc format to one that my accountant prefers but I notice it has not tallied up the commission in the total cost of each trade.

Is this because I cannot include these as costs or should I go through all my contract notes and add the commissions to the total cost of each trade.

Not something I look forward to having to do but with 79 trades and not a good trading year it could add up to about 800 quid I can further offset against any gains (I am guessing).

[someuwin] 29/11/2011 18:15

Result of the Autumn Statement...

"CGT allowances will be frozen at the current level of £10,600 for a year, and will not be increased in line with inflation. With consumer price index (CPI) inflation running at 5.2%, it had been expected that the CGT allowance would rise to about £11,100 for 2012-13."

[bpa002] 29/11/2011 12:06

Can I offset losses on shares against CGt on sell of property?

[plasybryn] 26/11/2011 14:42

Are investors here also in Personal Assets Trust? (PNL)

[nomunnofun] 18/11/2011 15:36

MIATA - not a big surprise. Gengulphus - very impressive (not sure I would have wanted you as a client though)

[cazsco] 18/11/2011 10:25

Thanks guys for responding. I always monitor this thread - amazing the bits and pieces that you can pick up.

[gengulphus] 18/11/2011 08:59

In my case, it's a combination of having had to deal with a lot of CGT myself, an insistence on properly understanding the various tax returns and other forms myself before signing them, a willingness to go and dig through HMRC material to get that understanding, and a bit of a "packrat memory" - if I've researched something to the extent of understanding it in the past, there's a good chance I'll remember it, or at least where to go to refresh my memory of it.

It does mean that my knowledge of tax in general is very patchy because of being driven by what I've had to deal with myself - e.g. I've quite a lot of knowledge of CGT, but very little of company taxation.

Gengulphus

[cazsco] 17/11/2011 19:25

Out of pure nosiness can I ask Gengulphus and Miata how they have so much tax expertise? Are you guys trained accountants?

Don't feel that you have to answer, just intrigued.

[wynmck] 17/11/2011 19:05

thanks guys,appreciated.

[gengulphus] 17/11/2011 18:53

Slightly fuller answer: you've got to use same-year losses up against gains as much as possible, so you've got to use £500 of the losses up against the gains, leaving the remaining £1500 of losses to carry forward into the next tax year, as MIATA says.

Unless by some chance you mean that £2000 of losses were brought forward from the previous tax year (I don't think you mean that, but am not 100% certain). Brought-forward losses only have to be used against gains to bring them down to the CGT allowance, so in that case none of them have to be used aginst the £500 gains and all £2000 of the losses can continue to be carried forward into the next tax year.

Gengulphus

[miata] 17/11/2011 18:28

Yes, £1500.

[wynmck] 17/11/2011 17:19

a query re carrying forward losses..
if in this tax yr I had only ,say £500 gain and £2000 losses taken,-how does that work out-are you still allowed to c/f losses,and how much?
thanks in advance

[miata] 15/11/2011 12:43

Probably, insufficient information/clarity to answer I'm afraid.
Age, tax code, and copy of the tax calculation summary would help.

Pension 5312
Personal pension 13487
Interest
Dividends
TOTAL INCOME RECEIVED 18799
Less Personal allowance 6475
TAXABLE INCOME 12324

Income tax charged

Less dividend tax credits
Less tax deducted on interest
Less tax deducted on pension 1168

Income tax due