Calculating Capital Gains Tax??

Drag-Den

Hi,

For reasons out of my control I am going to be forced into selling approx 14k of shares in March 08. My partner is in the same position and we are both worried that because we are having to sell this amount we are going to get stung on CGT. The 14k will comprise of approx 8k profit which i believe is under the allowance per year but then i read something about it being linked to your salary?? Really confused, any advice would be much appreciated!

Den

[Deleted User]

Hi,

don't think you should worry too much, your allowance for this year is £9200, anything above that would be added to your salary and then taxed.

Do you have to sell this tax year or could you hold on?

CLAPTON

if the profit is 8000 there will be no tax to pay as your cgt allowance is 9200.

Drag-Den

Hi Guys - thanks for the advice.

To clarify I will have to sell in March next year so if i understand correctly that will use up most of my allowance for next year??? (I'm assuming year runs jan-dec not the financial year apr-apr) Pleased that it appears I wont be subject to CGT as was beginning to think I would.

Incidently, if you are how is it collected? Do you have to declare it or is it taken automatically when you sell shares?

Thanks

hopon

The year runs 6/4 - 5/4 so if you sell in March you will only be using your 07/08 allowance leaving the 08/09 allowance available.

If there is CGT payable you have to declare it, it isn't deducted automatically.