Question on Capital Gains Tax

talexuser

My girlfriend has various shares in her name given to her by her father before he died 12 years ago. She now wants to sell some shares to get this years isa allowance. How much can she sell without being liable for capital gains tax? Thanks for all replies.

Lokolo

Currently £10,100.

Tomorrow it goes upto £10,600.

This is also based on profit, not revenue.

Thrugelmir

2010/11 tax year ends today. So you've left it very late to sell.

Biggles

Not possible, unless your broker is very accommodating indeed, the proceeds of the sale won't be settled until Friday. Unless you were meaning the 2011/12 ISA allowance.

As regards how many she can sell, it depends on the value at the date of sale as compared to the value on the date they were inherited. The difference between the two is the capital gain and, as long as the total capital gain is less than £10,600, she won't be liable to CGT.

If she's only interested in selling enough for the ISA allowance, that won't be a problem.

Thrugelmir

Biggles wrote: »

As regards how many she can sell, it depends on the value at the date of sale as compared to the value on the date they were inherited.

Shares appear to have been gifted before he died.

Biggles

Thrugelmir wrote: »

Shares appear to have been gifted before he died.

True, missed that. But the same thing applies, ie her 'acquisition cost' is the value at the date they were gifted.

talexuser

Thanks for all your replies.

Sorry I was not clear, she has used her 2010/2011 allowance, so the sale is to fund the 2011/12 allowance.

Am I correct in assuming that if the shares were a gift the profit for CGT is the difference in price between the gift date and the sale date? Or was there some sort of taper relief for the 12 years so that she could sell for more?

Biggles

talexuser wrote: »

Am I correct in assuming that if the shares were a gift the profit for CGT is the difference in price between the gift date and the sale date?

Correct.

Or was there some sort of taper relief for the 12 years so that she could sell for more?

Taper relief doesn't apply any longer.

But it doesn't matter anyway, if she only wants to sell enough to fund her ISA. CGT won't be a factor.

talexuser

Thanks again