Share Profits

PaulDonn

Hey people,
Just had one of my AIM shares rocket and made an excellent profit.
Now i have 25k in my iii.com account, waiting to be taken out.

I take it i have to declare 18% of this to the taxman in a self assessment..

Just wanting to know what is the best way to avoid the taxman with as much of this as possible, its going to be going towards a deposit for a house so i will need the cash available.

Just so you know my initial investment was 10k, so not peanuts.

Thanks for your help.

LOST

okay so you've made a 15k gain (excluding dealing charges etc), you will have a £10,100 capital gain exemption per annum.

So you will then be liable for CGT @ 18% (28% if you are a high rate or additonal rate tax payer i.e. 40% and 50%) on £4,900 which will equate to a liability of £882.

1. Were the shares registered in your name or jointly with say a partner as you will therefore have 2 lots of £10,100 exemptions meaning no CGT due (assuming this is you only gain in the tax year).

2. You can offset any allowable losses against the gain to mitigate/reduce the liabiity - capitalise any other holdings of shares you think that you will never make back your losses on (or alternatively sell them and buy them back in an ISA account)

AndyGuil

You can also sell the profit on the shares over £10,100 in the following tax year to use part of that years tax allowance. I.e. sell £20,100 now and the rest in the next tax year.

sabretoothtigger

Its not a profit unless its already sold, I presume he sold all the shares. Which company was this

AndyGuil

sabretoothtigger wrote: »

Its not a profit unless its already sold, I presume he sold all the shares. Which company was this

If the £20,100 is sold this tax year and what is left is sold the next year then it is a profit unless they go bust or it is expected the share price will go down making the tax loss irrelevant. That is the key question.

PaulDonn

Thanks for the replies.

Firstly the company was Solomon Gold, LSE:SOLG

I am a higher rate tax payer 40%.

95% of my shares are sold and the money is not in the company but sitting in my iii account online, it takes 1 week before you can withdraw it i believe.

I believe everything was just in my name, money to put into the shares came from my own bank account and am registered on iii as just myself.

Thanks

Reaper

Unfortunately you are asking the question when it is too late to do anything about it.

As mentioned above what you should have done was put your investments inside a S&S ISA [EDIT: Scrap that - I just noticed you said it was an AIM share which generaly can't be put into an ISA], or failing that spread your selling over this year and next.

Unless you incur a capital loss elsewhere you will just have to stump up the tax.

Still, it's only a small sum to pay considering the size of your windfall.

property.advert

Just forget about it. Do you really think someone is going to come knocking on your door for this ?

sabretoothtigger

True the inland revenue would not knock first No search warrant needed to seize goods if reasonable suspicion of tax evasion is there. Since he did it all on the books, it seems pretty risky to cross your fingers and why ruin such good luck with any worries.

Price quadrupled and halved now

http://www.iii.co.uk/articles/articledisplay.jsp?article_id=10119005&section=Markets


Another after the fact is betting on a share price is not taxable by cgt. Tiny little companies like this arent usually offered though, the main gold price is of course. You can always ring around on your next choice and ask them to give you some odds