CGT advice please on shares

longwalks1

I've been trading since last May, bit here and there and made a total of £5,127 profit (made £5761 in tital but sold 2 deals at a slight loss to fund other purchases).

I now have some 'penny' shares that have rocketed, if i wanted to sell some, and avoid CGT, is it right I can olny sell and make £4973 profit, unitl Arpil 1st?

Is this right? and if I wanted to sell more, making the £10,100 profit after the sale, I could od this the following day/week, as its into the next tax year?

Also (sorry for all the questions), when peole trade with an ISA, how does this work (breifly), and can i transfer shares from my share dealing account into an ISA?

Thanks in advance everyone

blinko

yes you ahve 10k annual allowance

do you have an ISA this year ?

if you are worried in the future about capital gains and it sounds like you are doing well and will probably regularly go above your limit i would suggest trading within your isa and lastly spread betting which is tax free

Just_landed

Hi

To avoid CGT in any one tax year which I think ends 5th April, £10100 is the max profit before paying CGT so yes £4973 is the figure. In the next Tax year you can sell and make another £10100 ( I think the figure is higher though for 2011-2012).

Be careful of the 30 day rule and The max you can sell gross 2010 - 2011 is £40400 above this figure you have to tell the Tax Man.

Re the Isa's you cannot transfer to an Isa as such, what you have to do is called bed and Isa, see your broker over this, in effect you sell the shares so that creates tax issue's then they are bought back within an Isa.

A couple of usefull links :-

http://www.hmrc.gov.uk/cgt/shares/basics.htm#1

http://www.hmrc.gov.uk/cgt/intro/report-gain.htm

longwalks1

Just_landed wrote: »

Hi

To avoid CGT in any one tax year which I think ends 5th April, £10100 is the max profit before paying CGT so yes £4973 is the figure. In the next Tax year you can sell and make another £10100 ( I think the figure is higher though for 2011-2012).

Be careful of the 30 day rule and The max you can sell gross 2010 - 2011 is £40400 above this figure you have to tell the Tax Man.

Re the Isa's you cannot transfer to an Isa as such, what you have to do is called bed and Isa, see your broker over this, in effect you sell the shares so that creates tax issue's then they are bought back within an Isa.

A couple of usefull links :-

http://www.hmrc.gov.uk/cgt/shares/basics.htm#1

http://www.hmrc.gov.uk/cgt/intro/report-gain.htm

Thanks JL

So if I open an ISA with my share dealing co (First Direct), I could sell (what amount?) of shares, and buy them back pretty much straight away with my ISA account? If so, what is the maximum i can buy with the ISA?

Thanks again

Pachira

britishboy wrote: »

and if I wanted to sell more, making the £10,100 profit after the sale, I could od this the following day/week, as its into the next tax year?

Yes. You could sell the second tranche after 6 April when the new tax year begins.

britishboy wrote: »

Can i transfer shares from my share dealing account into an ISA?

If you transferred all the shares into an ISA in one tranche this would not avoid cgt as they would be deemed to have been sold by you and then repurchased in the ISA.

m0n3y_3

If you have sold any shares at a loss in this tax year then you can deduct this, so in affect add it to the 10,200 allowance I believe, if you haven't sold any at a loss then congratulations!

longwalks1

Pachira wrote: »

If you transferred all the shares into an ISA in one tranche this would not avoid cgt as they would be deemed to have been sold by you and then repurchased in the ISA.

Thanks Pachira

So if I sold £10.1k of shares i currently hold, say breaking just even then, could that be used to buy shares in another company up to value of £10,100 for year 2010/2011?

But I cant sell £10.1k worth of shares (that I paid, say £5k for), then reinvest this £10.1k into shares of another company straight into my ISA?

Thanks again

longwalks1

m0n3y wrote: »

If you have sold any shares at a loss in this tax year then you can deduct this, so in affect add it to the 10,100 allowance I believe, if you haven't sold any at a loss then congratulations!

Minor losses to buy into others while they are still climbing, im new to it all but learning (hours spent on MSE is helping loads!)

Just_landed

britishboy wrote: »

Thanks Pachira

So if I sold £10.1k of shares i currently hold, say breaking just even then, could that be used to buy shares in another company up to value of £10,100 for year 2010/2011?

The £10100 is the profit after commission & stamp duty taken off, not the sale price.:)

longwalks1

Oh I see, thanks again JL, so if i paid £10k for the shares 2 months ago, i could sell them for £20k and pay all that into an ISA for this year?

Just_landed

britishboy wrote: »

Oh I see, thanks again JL, so if i paid £10k for the shares 2 months ago, i could sell them for £20k and pay all that into an ISA for this year?

No,
you have to break down the selling from the buying.
Selling is one thing the profit from the sale in your investment A/C is subject to CGT if above £10100 2010 - 2011.
You then transfer your money into a S & S Isa A/C then buy back the said shares within the Isa wrapper, so you will be subject to a dealing charge and stamp duty again. The Max you can buy in a S & S Isa in this Tax year is £10200 subject to conditions, all depends on if you have taken out any cash Isa's this year.

a useful link :-

http://www.moneysavingexpert.com/savings/ISA-guide-savings-without-tax#in

and another :-

http://www.hmrc.gov.uk/isa/faqs.htm

more to give you a rough idea of your profit be carefull its not spot on in certain circumstances :-

http://www.cgtcalculator.com/