Capital Gearing Share Discussion Threads

[singh is king] 11/1/2012 21:10

Will do.Thanks for the prompt reply david.

[david77] 11/1/2012 21:04

See "5: Convert data from www.CGTcalculator.com format for www.stonebanks.co.uk " on the stonebanks website.

[singh is king] 11/1/2012 20:55

david77 a little help from you please re. stonebanks calculator.Can you please remind me how to input data from the CGTcalculator to the stonebanks calculator,so that i can double check my workings out.I did it last year,but have forgotten how.
Must write it down this year lol.
Thank you.

[singh is king] 11/1/2012 20:50

Would appreciate a little help from the resident experts here re. negligible value claims.
Just working on my tax return for 2010/11.
I lost a substantial sum with JRVS in 2010.
HMRC have now placed JRVS on their negligible value list with an effective date of 26/03/10.
My question is can i still include this loss in my 2010/11 tax return,bearing in mind that it needs to be submitted in less than 3 weeks?To date i have not written to HMRC informing them of the loss.Do I have to inform them in writing and wait for a positive reply, or can i just make the claim on my return? and if so how do i do this?(Is it possible to show a sale of the shares at zero value?)
Many thanks.

[miata] 11/1/2012 08:28

And watch out for high daily interest charges on running spreadbets.

[david77] 11/1/2012 07:47

You will have to sell your shares either on thhe market and use the cash to start your SB account or sell the shares to the spreadbet company. The deals count as sells as far as the taxman is concerned.

He doesn't want to know about SBs 'cos most people lose on SBs. BE VERY CAREFUL, I WOULD BE BANKRUPT BY NOW IF I HADN'T SOLD WHAT I COULD AND BOUGHT THE REST FROM IG INTO A SHARE TRADING ACCOUNT AND CLOSED MY SB ACCOUNT several years ago.

IT IS VERY EASY AND TEMPTING TO BUY MORE THAN YOU CAN AFFORD - I ONLY PAID 25% OF THE DEAL PRICE SO HAD SHARES WORTH FAR MORE THAN I COULD AFFORD. THAT'S WONDERFUL ON THE WAY UP, BUT DISASTROUS WHEN THE MARKET FALLS - AND IT WILL FALL AND MARKET MAKERS DON'T WANT YOUR SHARES WHEN YOU ARE DESPERATE TO SELL THEM.

GOOD LUCK

[chienti] 11/1/2012 07:47

Thanks Gengulphus, appreciated

[the oak tree] 10/1/2012 21:36

Am about to change my stock holding to spreadbets. Once that happens and if they then went up to a profit would I have to tell them my spreadbet holdings i.e. even if I'm not due to pay tax, as they are bets, do they still require to know what trades I've done? Anything else I should be aware on this?

Thanks for any help on this.

[geordy2] 10/1/2012 18:23

MIATA

Thanks for clearing that up for me. Can you recommend a CGT calculator.

rgds

graham

[miata] 10/1/2012 17:46

Assumption: You did not sell any shares within 30 days of any purchase.

The appropriate numbers are the pool balances at each time you made a sale.

"sell 20K over a number of trades" means there is not one balance but several that you must use.

If in doubt just use one of the cgt calculator programs.

[geordy2] 10/1/2012 16:56

Can anyone clarify the following for me, I am at a loss as to the correct method to use.

In year one I buy in total 100k shares in company X , these are acquired at various prices through several trades. I only sell 5K of these shares in year one and use the pooling method to derive the capital gain.

In year 2, I acquire another 50K shares at various prices and sell 20K over a number of trades.

My question is, what numbers do I use in the Year 2 CG calculation. Do I use the value of total no of shares purchased over the two years = 150K, or do I use Total shares purchased less the sales in year 1. 150k-5k=145k ( I assume the value of the 5K that I deduct will be the calculated value in year 1 )

Many Thanks

Graham

[gengulphus] 07/1/2012 02:47

On page CGN10 of they say "It is up to you how you prepare your computations ...". As far as I am aware, they mean it, so I'd suggest putting them into as many or as few files as works for you. Just make certain they're complete and correct - and I'd recommend putting some effort into making them clear as well, as you don't really want to have to deal with a whole lot of requests for clarification even if there is nothing actually wrong with what you said...

Gengulphus

[chienti] 05/1/2012 21:39

one last quicky then I think this newbie to self assessment is done! Do we need to submit one file containing a calculation for each disposal? or lump all into one file?

[chienti] 03/1/2012 11:05

super, thanks again Gengulphus.

[gengulphus] 03/1/2012 08:46

chienti,

The self-assessment forms themselves don't actually ask for acquisition dates nowadays - they used to be relevant in the days of taper relief, but that stopped being the case in the 2008/9 tax year.

In the computations you have to send in with the self-assessment forms, I would simply put down both dates, labelled clear as "Date of grant of options" and "Date of exercise of options" or such like. You probably don't need to include both, and may well not actually need to include either - I cannot think of anything that requires the taxman to be given them. But it's quicker and easier just to give both!

If you're using the computation worksheet on page CGN21 of , note that using that worksheet is not a requirement and indeed sometimes isn't suitable. In particular, page CGN10 of the same link says that it isn't suitable in some circumstances, including when the asset has been obtained by the exercise of an option... However, my feeling is that it would be easy enough to deal with the date issue: I would do something like drawing a line through the "Date of acquisition" boxes, write alongside "See description above", and put "Date of grant of option xx/xx/xxxx, date of exercise of option xx/xx/xxxx" at the end of the description box.

However, the date issue might not be the only one associated with employee share options - in particular, the split of your overall gain between income and capital gains depends on the type of scheme and possibly other circumstances as well. So make certain you understand what the correct tax treatment is - hopefully your employer will have given you some guidance about that, and may well contain helpful information, including in some cases information about what you should use as the acquisition date.

With regard to your other question, from a taxation point of view you paid the exercise costs, then you received the disposal proceeds minus the incidental costs of disposal (i.e. dealing commission, and PTM levy if the disposal proceeds were over £10k), and so you report it as such. The fact that you and the dealer had a payment arrangement in which he just paid you the difference rather than you each paid the other is just a convenience for you, not relevant to tax.

Gengulphus

[chienti] 02/1/2012 11:57

Thanks for your help in the past guys, I have another question :(
As part of my employment I got share options that I excercised and sold on the same day last tax year. As part of filling in the self assessment when do I date these as being bought? When the options were first granted or the date they were excercised and sold. Thanks.
Also regarding reporting of the costs, I didn't pay anything to excercise them but the dealer took the costs of excercising them out of the consideration. Do I report the buying costs to me as 0? or report the costs as the exercise value

[seible] 01/1/2012 17:25

Sorry, you mean the date on which I bought or sold shares, correct? So, in my case above, I should use 5th April and not the 8 April date, right?

Thanks for your help!

[david77] 01/1/2012 16:14

contract date

[seible] 01/1/2012 11:18

Happy New Year everyone!

I just wanted to ask what date shall I use for the purpose of CG calculation - is it the transaction date or the settlement date? I sold some shares at a loss on 5th April 2011 (with settlement date of 8th April 2011) and wondered if I can include these transactions into my 2010/11 return.

Thanks in advance!

[miata] 30/12/2011 16:53

Expenditure on establishing or defending your legal title to the asset. I've never come across a case of this applying to a shareholding

Interesting. I suppose if your share certificate gets lost in the post the fee (minimum £40) for replacing it (its sent at your risk) would qualify.

[gengulphus] 30/12/2011 16:26

tehmac,

I'm afraid them's the rules... Daft or not, you have to follow them, so whether they are daft doesn't really matter when you're preparing your tax return - only if you want to tackle the different job of persuading the government to change the rules.

Just to make certain you've got the basics right:

Disposal proceeds = what you're paid for the asset (for shares, number of shares times price per share). Do not deduct any incidental costs of selling (e.g. broker commission) when you work out disposal proceeds.

Normally, gain or loss as defined by the taxman is (disposal proceeds) - (amount paid for the asset) - (incidental costs of buying and selling)

= ((disposal proceeds) - (incidental costs of selling))
- ((amount paid for the asset) + (incidental costs of buying))

= (final amount on sale contract note)
- (final amount on buy contract note)

There are a couple of other types of cost that can sometimes be deducted:

* Enhancement expenditure on the asset. This mainly comes up with shares if the company has a rights issue and you take up your rights - the money you subscribe for them basically counts as enhancement expenditure on your shareholding. I doubt it will come up very often with your trading style!

* Expenditure on establishing or defending your legal title to the asset. I've never come across a case of this applying to a shareholding, but I imagine it could if e.g. you were left a legacy of some shares, but the will was contested and you had to pay some legal costs to establish tht you really were entitled to the legacy.

Note also that all costs you deduct in calculating a gain or loss on an asset must be wholely and exclusively to do with that asset. E.g. if your broker charges an annual account fee, that fee is not wholely and exclusively associated with any one holding or trade, but shared between all of them - which for CGT calculation purposes means that it cannot be deducted at all. (Yes, that's another rule that is arguably daft - though the calculation complexities that would result if you could share it out are also very arguably daft!)

Gengulphus

[david77] 30/12/2011 16:03

"tehmac - 30 Dec'11 - 12:12 - 109 of 113

So, say I only ever buy in £1000 amounts, and say I always broke even and sold it for £1000 again (after x days). My disposal proceed on each trade is equal to £1000, correct? Therefore, if over the course of one or two months, I have made 41 purchases, then 41 sells, my disposal proceeds equal £41,000, which is higher than the "tax free allowance" of £40,400, and I have to report everything regardless?

This seems daft. What if you make only 2 trades during a whole tax year, break even on both, but each trade you were in you sold for the sum of £21,000. You have to do the CGT paper work for that."

Yes - you have to submit CGT returns - not difficult if you use one of the free on-line calculators.