Off-setting share losses against capital gains tax

Daniel987

Hi all,

I searching the MSE site and also the HMRC site but I thought i'd ask in case anyone had any direct advice.

This financial year I made money above the capital gains tax limit. This was on shares privately bought and sold and also on company stock options which I sold as I left.

I have a number of other shares that have lost significant value (almost to be worthless) and i'm considering selling them to offset the capital gains on the above.

I want to do so in this tax year. Does anyone have any advice beyond selling the worthless shares this year?

Thanks

nomunnofun

Sell only enough shares to create a loss when, after offsetting, brings you down to the CGT exemption limit.

pjclar02

It may be worth discussing this with an accountant. If you have other shareholdings that are worthless, it may be possible to claim the "loss" against your income, rather than against the capital gains. This may get you relief at a higher rate of tax.

Daniel987

nomunnofun wrote: »

Sell only enough shares to create a loss when, after offsetting, brings you down to the CGT exemption limit.

Yes, that's what i'm doing.

Working out my CGT now, based on all incomes, and then selling enough shares to drop the CGT paid.

Daniel987

pjclar02 wrote: »

It may be worth discussing this with an accountant. If you have other shareholdings that are worthless, it may be possible to claim the "loss" against your income, rather than against the capital gains. This may get you relief at a higher rate of tax.

I want to avoid this as my tax affairs are very simple. As I have only returned to the UK recently my only income by the end of the tax year will be about £4000 from my flat with i'm letting out now.

So really my tax year profit will consist of one share sale, one options sale and £4000 income.

My only objective is to reduce CGT which will already be at the lower band due to my income

Daniel987

Actually a side question - as my taxable income will only be £4000, well below the yearly personal allowance, will this mean my capital gains tax allowance will benefit from the other £4000 I have not used or are the two not interchangeable?

Thanks

grey_gym_sock

they're not interchangeable.