Shares and Tax

CashStrappedTeen89

Hi Everyone

Im currently invested for 3k in a company and 1.5 in another, now one im for long term and currently sat at a loss of around 30% (1.5k investment), the other (3k) all being well sp price should jump around 300-400% in the next few month to net me around 10k when/if this happens ill be withdrawing 3/4 to my iii account so say 7,500£, what will the taxman require off me is it the basic 20%?.

I havent filled an ISA this year so still have my 5,100 standard cash isa and a stocks one although i havent looked at stock isa's.

Any helps on this?, im new (3 months) to stocks and havent quite got my head around the tax implications.

Lokolo

The fact you think a share should jump to around 300-400% in a few months shows you are new.... Its unlikely, pretty much for certain not going to happen.

http://www.hmrc.gov.uk/cgt/intro/working-basics.htm
Capital Gains Tax maybe applicable, I can't be bothered to work out the profit.

CashStrappedTeen89

Lokolo wrote: »

The fact you think a share should jump to around 300-400% in a few months shows you are new.... Its unlikely, pretty much for certain not going to happen.

http://www.hmrc.gov.uk/cgt/intro/working-basics.htm
Capital Gains Tax maybe applicable, I can't be bothered to work out the profit.

It is an estimation based on the research ive done on the company and simular companies in the same scenario, area and other factors, If things where to go bad i have a stop loss set up but the COS is pretty high and definately worth investing for.

Thanks will have a look.

xrjtg

In a nutshell, assuming you're a basic rate tax payer and the gains are reasonably modest: the first £10100 of gains are tax free, anything else is taxed at 18%. Losses can be offset against gains. No gain or loss exists until a sale is made, and rapid sales and purchases in an attempt to crystallise losses/gains are frowned upon and ignored for CGT purposes.

pmjenkins

Err, which company do you think is going to jump 300% ?

LongTermLurker

If you can transfer your shares into a S&S ISA, there would be no CGT to pay at all.

I back Lokolo - if you can make a profit of 300 - 400% in a matter of months you must be either very lucky or know someone on the inside - the fact that another company in the same market is doing well is meaningless. I wouldn't bank on it, but good luck.

CashStrappedTeen89

xrjtg wrote: »

In a nutshell, assuming you're a basic rate tax payer and the gains are reasonably modest: the first £10100 of gains are tax free, anything else is taxed at 18%. Losses can be offset against gains. No gain or loss exists until a sale is made, and rapid sales and purchases in an attempt to crystallise losses/gains are frowned upon and ignored for CGT purposes.

Thanks for the info it helps. so really i can make 10100 before it becomes tax'd

pmjenkins wrote: »

Err, which company do you think is going to jump 300% ?

The company im in is XEL, and by a few months i mean anywhere from 2-4months depending on other factors.
And !!!!!! im estimating based on previous results, i know nothings guaranteed.

LongTermLurker wrote: »

If you can transfer your shares into a S&S ISA, there would be no CGT to pay at all.

I back Lokolo - if you can make a profit of 300 - 400% in a matter of months you must be either very lucky or know someone on the inside - the fact that another company in the same market is doing well is meaningless. I wouldn't bank on it, but good luck.

Considering the company shares have already jumped over 30% in the last 2-3 weeks im already well on my way. ive been watching this company since last year at 79p.

LongTermLurker

CashStrappedTeen89 wrote: »

The company im in is XEL, and by a few months i mean anywhere from 2-4months depending on other factors.

Considering the company shares have already jumped over 30% in the last 2-3 weeks im already well on my way. ive been watching this company since last year at 79p.

It's your call, but if it was me I'd consider selling some now to lock in the gains. Maybe it will continue upwards, but maybe it won't.

I recall a quote from John Chatfield-Roberts from Jupiter: "Beware hockeysticks" - that jump from 15 - 21 Sept looks pretty steep to me - the question is, is it sustainable? Do you see that big rise to March 08 followed by the even bigger drop leading up to Oct 08? Timing the top's gonna be an interesting challenge.

Good luck though.

CashStrappedTeen89

LongTermLurker wrote: »

It's your call, but if it was me I'd consider selling some now to lock in the gains. Maybe it will continue upwards, but maybe it won't.

I recall a quote from John Chatfield-Roberts from Jupiter: "Beware hockeysticks" - that jump from 15 - 21 Sept looks pretty steep to me - the question is, is it sustainable? Do you see that big rise to March 08 followed by the even bigger drop leading up to Oct 08? Timing the top's gonna be an interesting challenge.

Good luck though.

I am considering it, watching the stocks today, buys and sells and will judge from there, i know theres going to be a "lull" shortly but if i stay in long term it may not matter, better that than bailling out now and suffering later with higher buyin price.

blinko

good luck but it sounds like you want to put your shares in an ISA then no tax to py at all and dont kid yourself on those kidna returns, your looking for the next rock hopper or cairn, they are few and far between

100% profit is very good achievement with shares if you hit that i suggest taking it and enjoying a night out, then ifyou want to re enter you can witht he profits of course up to you but try and set a target usually a point of resistance

CashStrappedTeen89

blinko wrote: »

good luck but it sounds like you want to put your shares in an ISA then no tax to py at all and dont kid yourself on those kidna returns, your looking for the next rock hopper or cairn, they are few and far between

100% profit is very good achievement with shares if you hit that i suggest taking it and enjoying a night out, then ifyou want to re enter you can witht he profits of course up to you but try and set a target usually a point of resistance

I think this threads getting a little sidetracked, i dont really care about peoples personal opinions with the company or potential SP price now/later, im asking about the tax implications, if it is possible to use my whole £10k or ISA allowance when withdrawing shares?.
Or will i have to tax the whole lot?, as its my first year of trading i'd have to look at the correct route to take regarding tax.

Thanks to everyone who HAS been helpful so far. :rotfl: