Transferring sharesave shares into an ISA

Vortigern

Liquidity wrote: »

Assuming I don't want to sell any shares immediately, I guess there's no way to ever get those other shares into the ISA?

The rules allow a direct transfer of shares to ISA within 90 days of exercising your option to purchase the shares. You can choose the date to make that purchase - it doesn't have to be the first available date. So, if you buy the shares less than 90 days before the end of the tax year, you should be able to put £20,000 worth into the ISA this tax year and the remainder in the next.

Having said that, I would not want to hold so many shares in a single company, especially if that company is my employer. I would sell some of those shares and reinvest in something more diversified.

Liquidity

Vortigern wrote: »

The rules allow a direct transfer of shares to ISA within 90 days of exercising your option to purchase the shares. You can choose the date to make that purchase - it doesn't have to be the first available date. So, if you buy the shares less than 90 days before the end of the tax year, you should be able to put £20,000 worth into the ISA this tax year and the remainder in the next.

Having said that, I would not want to hold so many shares in a single company, especially if that company is my employer. I would sell some of those shares and reinvest in something more diversified.

Indeed, I was thinking about that and I agree. At the minute I don't really have any choice in the matter (still saving until Sept) but afterwards I should look to spread my risk.

I was just worried that the 90 day limit kicked in the moment the scheme matures, i.e. Sept.

In that case, I will look to straddle 2 tax years, at least then any shared sold are exempt from CGT and dividend tax on the others.

flopsy1973

So i have a sharesave scheme that matured 1 Oct 18, i want to put mine into the ISA so do i have to get the share certificate to do this, i have a account with HL will they accept them.
thanks

Vortigern

flopsy1973 wrote: »

So i have a sharesave scheme that matured 1 Oct 18, i want to put mine into the ISA so do i have to get the share certificate to do this, i have a account with HL will they accept them.
thanks

If you bought the shares on 1 October, your 90 day window for direct transfer to ISA has closed. You'd have to "Bed & ISA", essentially this means you sell the shares outside the ISA and buy them back inside the ISA. There may be CGT to pay.

If you haven't yet bought the shares, ask for a certificate. This will make transfer to ISA a little easier.

As for HL, you'll have to ring and ask. I see no reference to employee shares on their site.

See my previous warning above about holding single company shares.

flopsy1973

I have not yet bought the shares I have give my maturity instructions by March so does that mean I could do the direct transfer if I have not yet bought them. When does the 90 days start from ?

bowlhead99

flopsy1973 wrote: »

I have not yet bought the shares I have give my maturity instructions by March so does that mean I could do the direct transfer if I have not yet bought them. When does the 90 days start from ?

As Vortigern had mentioned, the 90 days starts when you exercise the option to buy the shares (e.g., maybe March) not on the first day that you would have been allowed to exercise the option (last September).

So if you haven't yet exercised the option to buy the shares you could do that soon, and let the 90 day period straddle both the 18/19 and 19/20 tax years if you need to use the 19/20 tax year.

Per the gov.uk page the time starts when you take the assets out of your SIP or SAYE scheme. But basically if you have exercised the option, the shares are yours in the real world outside the 'scheme' and the timer has started, while it you haven't exercised your option to buy the shares, the shares are still in the scheme and subject to is rules and the timer hasn't started.

GazHol

flopsy1973 wrote: »

So i have a sharesave scheme that matured 1 Oct 18, i want to put mine into the ISA so do i have to get the share certificate to do this, i have a account with HL will they accept them.
thanks

I have successfully transferred ShareSave maturity shares into my HL ISA. Up until last Oct it had to be via the certificate (with maturity statement, ISA application and share transfer form), however I managed to persuade my employer to allow electronic transfers. Scheme has ended so I only managed the electronic transfer the once in 2018.

Best to drop HL a secure message asking about the process.

flopsy1973

ok have contacted HL, but now have another concern the company i work for is subject to a takeover later this year and offered 840 per share so this means all my shares i hold will have to be sold? I have the following shares through sharesave

4295 shares not sure of option price trying to find out
2811 shares option price 3.201
1804 shares option price 4.986
1784 shares option price 5.044
and i am saving towards one that matures next year not sure what will happen there

I was hoping to use this years ISA allowance to transfer some into and the new allowance in april to shelter more into. I want to avoid paying CGT on these is there something i have missed with this plan

flopsy1973

any advice on this please

Vortigern

flopsy1973 wrote: »

ok have contacted HL, but now have another concern the company i work for is subject to a takeover later this year and offered 840 per share so this means all my shares i hold will have to be sold? I have the following shares through sharesave

4295 shares not sure of option price trying to find out
2811 shares option price 3.201
1804 shares option price 4.986
1784 shares option price 5.044
and i am saving towards one that matures next year not sure what will happen there

I was hoping to use this years ISA allowance to transfer some into and the new allowance in april to shelter more into. I want to avoid paying CGT on these is there something i have missed with this plan

I've no experience with takeovers so I hadn't replied previously, I was hoping that somebody more knowledgable might respond.

I don't believe an ISA will help with those shares that have already been purchased. You would have to sell the shares - thus realising a potentially taxable gain - then repurchase them within the ISA. This will not negate the gain you've already made or reduce the CGT payable. The ISA will protect you from future gains only, except in the special case of transfer to ISA within 90 days of exercising your option.

I would guess that where there is a known takeover offer of 840p per share, the current share price will have risen quite close to that offer price, and if you sell now most of the gain will have been made. If you wait for the takeover and the shares have to be sold at 840p all your gains will be realised on the same day and will probably exceed your CGT allowance.

That being the case, you may wish to consider selling some of your shares during this current tax year to make use of this year's CGT allowance.

You have what is known as a section 104 holding, meaning a pool of shares in the same company, purchased at different times and at different prices. You have to calculate the total number of shares held and the total amount paid for them to arrive at an average cost per share. Then knowing the current share price you can work out the gain per share and how many you can sell within the CGT allowance.

The above assumes all your shares have been acquired through matured sharesave (SAYE) schemes. The rules are different for other forms of employee share incentive plan (SIP) where the shares are bought from pre-tax pay and held in an employee shares trust account to avoid income tax and NI clawback.