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    monkfish
    Avoiding CGT by putting shares in isa
    • #1
    • 11th Apr 07, 10:46 AM
    Avoiding CGT by putting shares in isa 11th Apr 07 at 10:46 AM
    hi i wonder if anyone can help me.

    I am in a sharesave scheme whereby money is deducted from my salary every month and after 3 yrs the total saved is given a bonus interest of around 5% and then this money is used to buy shares in my employer at a discounted rate. Basically after 3 yrs i will have put in 9000 and the shares i get would be worth today around 27K.

    Now does this mean that if i sold them instantly i would be liable for 27k - cost (9k) - cgt allowance (9K i think) so 9k in capital gains tax.

    Basically i've heard that i can avoid this by putting the shares into an isa can anyone elaborate

    thanks in advance
Page 1
  • RabbitMad
    • #2
    • 11th Apr 07, 11:40 AM
    • #2
    • 11th Apr 07, 11:40 AM
    Yes, you will only be liable for CGT when you sell or give them away.

    If you are amrried or in a civil partnership you could transfer some to your OH and then you'd have two lots of CGT allowance to use.

    Alternatively sell some now and wait until the next tax year to sell the rest.

    I think to put them in an ISA would mean you'd need a self select ISA and you would only be able to shift 7K's worth in a year.
    • cheerfulcat
    • By cheerfulcat 11th Apr 07, 11:48 AM
    • 3,173 Posts
    • 1,350 Thanks
    cheerfulcat
    • #3
    • 11th Apr 07, 11:48 AM
    • #3
    • 11th Apr 07, 11:48 AM
    Hi, monkfish,
    Now does this mean that if i sold them instantly i would be liable for 27k - cost (9k) - cgt allowance (9K i think) so 9k in capital gains tax.
    Not quite; it would be £9000 of gains liable to tax at 20% or 40% depending on your tax status.

    Basically i've heard that i can avoid this by putting the shares into an isa can anyone elaborate
    You can move the shares into an ISA without crystallising a gain under certain circumstances; have a look here.
  • monkfish
    • #4
    • 13th Apr 07, 12:47 AM
    • #4
    • 13th Apr 07, 12:47 AM
    so it looks like i can sell 18k worth instantly and put 7000 worth into a isa leaving me with just 2k that would be subject to cgt?
  • agal
    • #5
    • 13th Apr 07, 3:08 PM
    • #5
    • 13th Apr 07, 3:08 PM
    Hi, monkfish,


    Not quite; it would be 9000 of gains liable to tax at 20% or 40% depending on your tax status.



    You can move the shares into an ISA without crystallising a gain under certain circumstances; have a look here.
    Originally posted by cheerfulcat
    Surely 27k - 9k means there would be 18k of profit liable to CGT?
    • cheerfulcat
    • By cheerfulcat 13th Apr 07, 4:14 PM
    • 3,173 Posts
    • 1,350 Thanks
    cheerfulcat
    • #6
    • 13th Apr 07, 4:14 PM
    • #6
    • 13th Apr 07, 4:14 PM
    Surely 27k - 9k means there would be 18k of profit liable to CGT?
    Originally posted by agal
    It's 27,000 - 18,200, actually; you take away the cost ( 9000 ) and then use the CGT exemption ( 9200 for the current tax year ). This leaves 8800 of gains liable to CGT.
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