Tax on Stock Trades

katapult99

Hi,

In addition to the brokers commission and Stamp Duty, do you also have to pay Capital Gains or other Income Tax on money made on a stocks & shares trade?

CLAPTON

capital gains tax is due on profits over 10,600

DavidHayton

If you invest outside an ISA or pension ...

Dividends are subject to income tax. However, they are paid net of basic rate tax so basic rate tax payers have no further income tax to pay. Unfortunately, non tax payers cannot reclaim the basic rate tax (something to thank Gordon Brown for for!)

Higher rate tax payers stillneed to pay the higher rate tax

Hope this helps
David

katapult99

I'm a higher rate tax payer investing outside of an ISA, so if I sell stock at £100 gain, I would:

Pay £10'ish commission (£10)
Pay 0.5% Stamp Duty (£0.50)
Pay 40% Income Tax (£40)

...leaving £49.50?

SAK45

No you only have to pay tax on profits over £10600 for tax year 11/12....so wait till the tax year has ended then do you calculations

katapult99

Got it - thanks!

atypical

katapult99 wrote: »

Pay 40% Income Tax (£40)

It's capital gains tax at 28%, not income tax at 40%. Only on anything above £10,600.

cing0

More realistically, you can set your gambling (share trading) losses off against future gains for capital gains tax purposes on your SA form.