Capital Gearing Share Discussion Threads

[gengulphus] 28/12/2011 10:39

2. No (unless you bought back the same shares you sold within 30 days of 05/04/11).

That's potentially misunderstandable, so I'll clarify the situation that MIATA is talking about. It is the situation where:

* You sold before the end of the 2010/11 tax year, i.e. on April 5th 2011 or before.

* You bought the same type of share after the start of the 2011/12 tax year, i.e. on April 6th 2011 or afterwards, and the purchase was in the 30 days following the sale (calendar days, by the way - i.e. do count weekends and bank holidays).

In such circumstances, the gain on the 2010/11 sale is calculated from the 2011/12 purchase, which may well make it a significantly smaller gain than would have been calculated from the original purchase.

The particular point I'm clarifying is that for the 2011/12 purchase to be involved, it has to be within 30 days after the 2010/11 sale - what MIATA wrote is easily readable as saying it only has to be within 30 days after 5th April 2011.

Gengulphus

[miata] 28/12/2011 09:12

1. Yes.
2. It doesn't affect your annual exempt amount, but might affect the rate (18% or 28%) at which your taxable gains are taxed.

[miata] 28/12/2011 09:04

In the absence of specifics (there are a few reliefs that apply in extremely limited circumstances which are unlikely to apply to you):
1. No.
2. No (unless you bought back the same shares you sold within 30 days of 05/04/11).

[qipincha] 27/12/2011 23:18

Hi All,

Sorry i am newbie, my situation is really bad
I made quite a lot profit between 2010-2011(about 30k profit beyond the allowrance), but unfortunately made similiar amount of loss between 2011-2012.
two questions here:

1. is there any way to avoid paying so much CGT for 2010-2011 year?
2. if I make the CGT for 2010-2011 year, will I be able to claim them back to cover my loss in 2011-2012?

Many thanks.

[qipincha] 27/12/2011 22:32

hiya,

1.I am working on the HM online system, but really confused. The system asked me whether I were also employed. As I have already been charged for tax and NI, do I still need to fill in this part of the form?

2.and if i have a salary of say 30k a year, will that affect my CGT allowrance?

Thanks.

[pineapple1] 26/12/2011 01:27

Miata....thanks for your answer

[david77] 23/12/2011 21:25

I've been using the Stonebanks calculator for a number of years and my tax returns have not been challenged. The Stonebanks calculator follows the taxman's rules - see

[seible] 23/12/2011 21:09

Hi guys,

I have a question about the cgtcalculator and stonebanks programs - are those recognised as the accepted methods of CGT calculation by the HMRC?

Thanks in advance!

[gengulphus] 22/12/2011 22:21

Sorry, but it doesn't seem at all bizarre to me that you pay more if you do the calculations according to the rules than if you do them the way you would prefer to. It would hardly be the other way around, would it? ;-)

You can at least console yourself with the thought that every increase in the gains you're counted as realising this year means a corresponding decrease in the gains that are currently unrealised - gains that you might well end up realising next year, or the year after, or the year after that, etc. I.e. more CGT paid now does have the consolation of expecting less CGT will have to be paid in the future than would have been the case if you got to do the calculations the way you prefer. Not correspondingly less, because of things like the time value of money, the possibility that you won't realise the gains before you die, the possibility that CGT law changes will change that future CGT, etc, but it does reduce the blow quite substantially.

Gengulphus

[pineapple1] 22/12/2011 12:18

Gengulphus......Thanks for the advice.It seems bizzare that i should pay more like this ..

[gengulphus] 22/12/2011 09:47

I used the cgttaxcalultor .com which is very good.One strange anomoly though was that i have two trading accounts,and when i entered the records together they came up with a different gains made fig than when i entered the accounts seperately by a couple of thousand pounds.Is this a glitch i wonder.

No, it's a real effect, caused by different matching of buys to sells. E.g. suppose that in account 1, your trading record is:

01/06/10 Buy 3000 shares for a total of £3000
01/06/11 Sell 1000 shares for a total of £2000

Faced with those figures on their own, the calculator will match the sale to 1/3rd of the buy, so the gain calculated is £2000 - £3000/3 = £1000.

Meanwhile, in account 2, your trading record is:

01/12/10 Buy 1000 shares for a total of £1800
01/06/11 Sell 1000 shares for a total of £2000

Faced with those figures on their own, the calculator will match the sale to the buy, so the gain calculated is £2000 - £1800 = £200.

The combined trading record is:

01/06/10 Buy 3000 shares for a total of £3000
01/12/10 Buy 1000 shares for a total of £1800
01/06/11 Sell 2000 shares for a total of £4000

Under the current share matching rules, the computation goes that first, the two buys are combined into one of 4000 shares for a total of £4800, and then the sell is matched to half of that combined buy, producing a gain of £4000 - £4800/2 = £1600. Which is not the same as the total of the £1000 and £200 gains calculated on the two accounts separately.

The difference is compensated for by the unrealised gains left in the holdings. Supposing for example that the current share price is 250p, in each case the 2000 shares you have left are worth £5000. For the two accounts calculated separately, their acquisition cost is 2/3rds of £3000, i.e. £2000, and so they have an unrealised gain of £5000 - £2000 = £3000 on them; for the combined calculation, their acquistion cost is the remaining half of the total £4800, so the unrealised gain is £5000 - £4800/2 = £2600. So the total of the realised gains and the unrealised gains comes out as £4200 either way, either as £1000 + £200 + £3000 or as £1600 + £2600. Which is basically just because both come out as the current value of the shareholding (£5000) plus the money you've taken out (£4000) minus the money you've put in (£4800).

Because of that, the two methods will end up producing the same net gains overall if done over a period in which you start and end with no shares (for at least 30 days in each case), since there can then be no unrealised gains and the realised gains are just the money you took out minus the money you put in. But otherwise, the realised gains can vary according to whether you calculate the two accounts separately or together.

Of course i will submit using the method of two seperate accounts with the lower liability but i found this rather odd.Any one else tried this.

Bad idea. The UK share matching rules require you to do the calculations on all of your accounts put together - you're not allowed to do them on each account separately.

It's a thorough nuisance, because if it weren't for that requirement, each of your brokers could send you a consolidated CGT computation for your account at the end of each tax year, just as they send you a consolidated dividend tax voucher, and dealing with CGT would become a simple matter of adding up the figures for the individual brokers. But I'm afraid that's the way it is...

Gengulphus

[david77] 22/12/2011 09:09

The Stonebanks calculator doesn't tell how much tax will be due. It simply gives you the figs that the taxman wants - let him do the tax calcs - but you must complete your tax return early enough for that.

I never put a contract note away without adding the details to mycg1112.txt file (for the current year, of course). At the end of April 5th, the Stonebanks prog provides the figs to start the next year's file mycg1213.txt

[peteh1] 22/12/2011 09:04

Many thanks Gegulphus & david77.I can see where you are both coming from.
It seems to me that I have a bit of work to do to get this set up,particuarly regarding taking care with the 30 day rule etc.However,once I have done that and entered all the part trades,then I am home and dry.I see the calulator as a big advance on what I have been doing,and once set up with the correct data then I am laughing for all future entries.
I can't thank you guys enough.Thanks for taking the time to answer my query.
Looks as though I may be doing calcs over the Xmas period.Hoping for bad weather to keep me in and hard at it.Much appreciated.

[pineapple1] 22/12/2011 08:45

I used the cgttaxcalultor .com which is very good.One strange anomoly though was that i have two trading accounts,and when i entered the records together they came up with a different gains made fig than when i entered the accounts seperately by a couple of thousand pounds.Is this a glitch i wonder.
Of course i will submit using the method of two seperate accounts with the lower liability but i found this rather odd.Any one else tried this.

[david77] 22/12/2011 08:42

If you know your closing quantities and total costs at April 5th 2011, then you can start the Stonebanks calculator with those figs, and then add data for each deal since then. It seems a daunting prospect, but you only have to enter 5 items for each deal once you've sorted your contract notes into company order. You don't need to put them in date order, the prog will do that for you.

The Stonebanks calculator needs less data input than the other one. Take your pick.

[gengulphus] 22/12/2011 08:38

Enter the trades (or parts of trades) left over from previous years as well as the actual year's trades. In the case of parts of trades, scale everything down according to the number of shares - e.g. if previous years dealt with 2000 shares out of an 8000 share buy, enter the remaining 6000 of the shares bought with 6000/8000 = 75% of that buy's trading costs. (Note that the trades and part of trades from previous years should all be buys, as sells are always completely dealt with for the tax year in which they occurred.)

Make certain you label the parts of trades clearly as such, so that the taxman doesn't see them as discrepancies from your other records!

Alternatively, enter all the trades going right back to when you started, and take care to only use gains and losses the calculator calculates for the tax year concerned in the tax return. That's likely to be more data entry work, of course, but might be useful if you want to double-check previous year's computations, or to let the calculator do the scaling down rather than do it yourself, or if you happen to have already entered all your trades somewhere else, etc.

Note by the way that if there's any danger that you've sold towards the end of the tax year, then repurchased in the following tax year but within 30 days or fewer after the sale, you will need to enter trades from the first 30 days of the next tax year as well, and filter any capital gains and losses sales in those trades create out of the ones you report. You can do this just for the shares that have that situation of a sell in the tax year followed by a buy in the following tax year within 30 days, or for all of them - obviously the latter requires more data entry, but less checking up on dates on your part. (Note also that if that situation does apply, just entering buys from the first 30 days of the next tax year may not be good enough - sells in those 30 days can also end up affecting the results.)

Gengulphus

[peteh1] 21/12/2011 23:03

Can anyone help?

I have previously completed my CGT by hand,carefully noting each buy and sale of numerous shares and to be honest,it is a nightmare,with the 30 day rule etc..I have read posts on here and have found the CGT calculator.
My problem is however, is how to start using the tax calculator.I obviously completed last years return but have share trades (or parts of trades that I still retain in my portfolio) purchased from last year or even the year before that.I can see that if I started share trading now from day one with both my full buys/sells complete then this would work.How do I start when I have purchases from previous years?

Hope someone can help.It's driving me nuts.

[nomunnofun] 21/12/2011 13:55

Yes - as Miata said in post 6373.

[greyseal] 21/12/2011 13:44

Thank you.

Please confirm that, as I read it, they should be declared on 2010/11 return

[greyseal] 21/12/2011 13:24

Bed & Breakfast question

If i sold shares on 01/04/2011 and bought them back on 14/04/2011, should the sale be declared on 2010/11 tax return or 2011/12?

Thanks

[miata] 20/12/2011 09:52

Try contacting your tax inspector and see if he would accept the increase in your brokerage account as a basis.

Have you thought of bulk trading in Sovereigns (CGT exempt) instead?

If you feel you might be a trader, cases to consider include
Martin v Lowry 1926, Wisdom v Chamberlain 1968 (Norman Wisdom was held to be trading silver bullion as he financed the trade through a loan), Johnston v Heath 1970,
Taylor v Good 1974 and Salt v Chamberlain 1979.

[pineapple1] 20/12/2011 05:28

Anyone any idea how to work out cgt due on multiple (100+) buy and sell transactions in gold bullion traded thru Bullion vault or Gold money.These transactions will be at differing weights of gold (due to liquidity at the time) and prices.
Its therefore not as easy as matching buy 1Kg at 34000 v sell 1Kg at 35000.
The quantity of bullion and cash held would vary and for example sometimes only a proportion would be sold before a larger quantity repurchased at a lower price (and vice versa of course)Trades could vary from 0.1kg up to 1kg

I was thinking of using the 30 day rule as with shares as bullion repurchased within the time period often occured but am un sure as to wether it would apply with this.It would likely make it easier as i could possibly adapt the figures to mimic shares to run on cgt calculator.
I can think of no other way.

[david77] 19/12/2011 17:40

I think that the Stonebanks calculator provides all the figs you need for your tax return. CGTcalculator does provide figs for tax periods whereas the Stonebanks one sorts into date order but otherwise just works thru the deals. The Stonebanks calculator follows the taxman's rules and produces more printed output than the other one, but I think it is easier to check the figs if you are so inclined.

See

My tax files are for each tax year. Recent deals have been added to mycg1112.txt

I ignore the 30-day rule over year breaks - but I tend to buy and hold so deal numbers are limited.

Edit - I do use the other calculator just to check that I get the same figs and that I haven't included any deals outside of the tax year.

[2toadstool] 19/12/2011 15:34

thanks for your help Miata and Gengulphus.

i was basically talking about entering each buy or sell (contract note)into CGT cal line by line ,some times i may have bought back shares in a company within 30 days....

the calculator always get the same profit or loss as per my own manual calculation but it obviously helps fill out the other sections in the summary sheet.

does anyone have preference- cgt calculator or stonebanks? cgt cal seems to give summary tax figures for all the sections that we have to fill out,i cant see this with stonebanks?