Bed and ISA - How do I do this?

Allan_C

Hi all,

I would like to move some of my shares I have from Barclays Smart Investor into an IWEB ISA due to the low cost fees.

Just as an hypothetical case as I don't want everyone knowing of my personal finances!

Just say, I have around £40k worth of shares, which gives me a profit of around £20k. Initial investment of £20k

2018/2019 ISA tax allowance is £20,000 and CGT allowance is £11,700

So, if I were to sell and move £20k into an ISA, I will not have to pay CGT, is that correct?

My calc - I sell £11,700 worth of shares (cgt allowance) + part of my initial investment of £8,300 = £20,000.

Then I can move the remaining £20k into next years ISA allowance (assuming the value remains the same)?

masonic

Your logic is correct, but your calculation is wrong. Based on your example (and assuming your capital gain is exactly £20k, or 50%), you sell £20k and would have to use £10k of your CGT allowance to account for the gain of exactly 50% what you paid for the shares, leaving a small buffer or £1,700.

Allan_C

OK, I've got it now! Thank you!