Ocado sharesave scheme.

westy23

Good morning.
My son is in the fortunate position of having an ocado sharesave scheme and is currently sitting on a total of £42205 for an outlay of £7200.
The scheme ends soon and he will able to access the shares,how should he go about selling the max amount of shares whilst avoiding any capital gains tax?
Thanks
Ps. he is a basic rate taxpayer

Stochasticity

1) Transfer £11,520-worth into a S&S ISA in the current tax year (within 90 days of the shares being released). Then sell these within the ISA.

2) Also sell £13,000-worth in the current tax year (keeping the gain below £10,900) as soon as they're available to sell.

3) Transfer £11,880-worth into the same S&S ISA in the next tax year (also within 90 days of the shares being released). Then sell these within the ISA.

4) Then sell the rest next tax year (as there shouldn't be enough left to generate a gain of more than £11,000).

Should be able to get rid of all of them (without any CGT) by the middle of April with all ISA and CGT allowances available.

More complicated if existing allowances have already been used up. A spouse could help!

Stochasticity

5) Transfer an amount up to 80% of earnings in the current tax year into a pension (also within 90 days of the shares being released). Then sell these within the pension.

alanq

Decisions should not be based solely on tax planning.

If the shares are anticipated to plunge in value then one may wish to sell ASAP even if that means paying more tax.

If the shares are anticipated to soar in value then one may wish to hold even if that involves paying more tax on the additional gains.

Freecall

alanq wrote: »

If the shares are anticipated to plunge in value then one may wish to sell ASAP even if that means paying more tax.

If the shares are anticipated to soar in value then one may wish to hold even if that involves paying more tax on the additional gains.

Thanks for that advice on investment planning.

All those people who waste money on employing advisors, if only they followed these simple rules then they would be millionaires.

Stochasticity

alanq wrote: »

Decisions should not be based solely on tax planning.

If the shares are anticipated to plunge in value then one may wish to sell ASAP even if that means paying more tax.

If the shares are anticipated to soar in value then one may wish to hold even if that involves paying more tax on the additional gains.

Except that:

1) You can't readily anticipate these things in the short term (and even the long term isn't much better).

2) Selling as much as possible ASAP and incurring CGT is locking in a loss at 18% or 28% (relative to waiting until the next tax year), which may be significantly more than the loss while waiting.

3) Employees are already over-exposed to the fortunes of the companies for which they work. They are likely to be better off in a diversified portfolio than a single share.