Capital Gains

poshboy

Hi all,

Need some help. I've just sold some shares I had from some matured employee sharesave schemes. The gain I've made on these is less than the £11300 capital gains tax free allowance. Therefore I don't believe I have any tax to pay on the sale of these shares, but please correct me if I'm wrong.
Also, for purposes of salary, does it affect my taxable income and potentially push me into a 40% tax bracket, or is that not affected. So at the moment the gain on sale of shares + my salary YTD would push me into the 40% bracket but otherwise without the sale, I'd be in the 20% still for the year. Does the share sale affect my salary and tax bracket at all?

Really appreciate the help.

Previn

Hi,

If it definitely is a sharesave, then there is no capital gains applicable if you sell immediately on maturity. If you keep the shares & then sell there maybe some cap gains applicable. Either way if you have no other gains in the year then there is nothing to pay.
Also, no impact on income tax or tax bands etc, that is a totally different set of allowances.

Link here with full details..
https://www.gov.uk/tax-employee-share-schemes/save-as-you-earn-saye

poshboy

Thanks a lot Previn. That makes sense. The profit made on the shares was over 3 separate schemes with the same company which matured in 2014,2015 and 2016. I kept the shares on maturity and sold them all last week. The total gain I made on these was under the £11300 capital gains allowance so nothing to pay I think.

6022tivo

Interesting thread, sorry to piggy back.

I am also in a Sharesave scheme at work.

Upon maturity (soon) I would have put in £18000 over three years, and at the current share price, the value will be around £34000

Profit of £16000

Because of GCT I was going to take £29500 out (initial investment + £11500 CGT limit) and then wait until after the following April to take the rest.

So, are you saying, I can just take the £34000 tax free on the final date.

My current options (I think are)

Take the £18000
Convert the shares and sell immediately for what will be around £34000
Convert and partial sell
Convert and hold on

Tom99

[FONT=Verdana, sans-serif]Re 6022tivo's query:

I am pretty sure you do pay CGT if you sell the shares immediately and make a gain but you can transfer say half the shares to a spouse then both sell each with a £11,300 annual allowance.

[/FONT] [FONT=Verdana, sans-serif]In your case if its just you the max current value of shares you can sell which would see a gain of £11,300 is £24,000 not the £29,500 you suggest. Here is the calc:

[/FONT] [FONT=Verdana, sans-serif](£11,300 / £16,000 )X £34,000 = £24,012.50

[/FONT] [FONT=Verdana, sans-serif]What was wrong with you previous calculation is that you were assuming you could set off the whole of your £18,000 purchase cost when you are only selling some of the shares.

[/FONT] [FONT=Verdana, sans-serif]The apportioned cost of the shares you sell will be (24/34)x18,000 = £12,700

[/FONT] [FONT=Verdana, sans-serif]So a sale at £24,000 less cost of £12,700 = £11,300 gain.[/FONT]

NotSkint

Whether CGT is applicable is dependant upon the type of share save scheme and how you dispose of the shares

See

https://www.gov.uk/tax-employee-share-schemes

p00hsticks

Also note that, as per Previns link in post #2, you have the opportunity to move the shares directly into an ISA within 90 days of the scheme maturing, which will then mean that there would be no CGT on any future sale.

macgyver

Interesting information. Similar question. Sorry to tag along on this thread. I am interested to invest in funds outside the isa or sipp. Say, if my income for this year is 90,000 and the gains from my investment was 11,000. Would my profits from my funds invested take me above the 100,000 for tax purposes and would I lose my personal allowance? Thank you.

bowlhead99

macgyver wrote: »

Interesting information. Similar question. Sorry to tag along on this thread. I am interested to invest in funds outside the isa or sipp. Say, if my income for this year is 90,000 and the gains from my investment was 11,000. Would my profits from my funds invested take me above the 100,000 for tax purposes and would I lose my personal allowance? Thank you.

Your personal allowance is taken off you at a rate of £1 for every £2 your income is over £100k.

In the example you describe, your income is only £90k and so they don't take away any of your income tax personal allowance for having a six figure income, because you don't have a six figure income.

Your capital gains are not used to work out your income tax. Just, your total amount of income and gains are used to work out your bracket for capital gains tax.