Tax Exemption

jasmin5395

As I don't earn enough I am tax exempt and have completed the necessary R85 form on my normal bank accounts.  I have been lucky enough to have the opportunity to buy some shares but would still be below my personal tax threshold.  When I decide to sell the share, is the tax the same sort of tax that would form part of my personal tax allowance?  If this is the case do I need to fill out another tax exemption form as it is with a different bank to my normal one.

colsten

Gains from shares (annual dividends as well as proceeds from sales) are treated as Capital Gains, and are subject to CG tax, not income tax. Everyone has an annual CG allowance. 

colsten

jasmin5395 said:

As I don't earn enough I am tax exempt 

At £50k, you aren't tax exempt of income tax https://forums.moneysavingexpert.com/discussion/6118365/cashing-in-sharesave-early

jasmin5395 said:

....have completed the necessary R85 form on my normal bank accounts.....

Banks don't withhold tax on interest payments any longer, and R85s are therefore redundant

soulsaver

You think you'll earn more than £1000 in interest in a tax year?

Old_Lifer

Well spotted   colsten. 

jasmin5395

thank you for all your replies. the investment wouldn't make any more than say 20k.
Thank you all for your informative replies.  That's what I wasn't sure of, if it was a different tax like Capital Gains. 

dunstonh

the investment wouldn't make any more than say 20k.

Is it in a tax wrapper or held unwrapped?

badger09

colsten said:

Gains from shares (annual dividends as well as proceeds from sales) are treated as Capital Gains, and are subject to CG tax, not income tax. Everyone has an annual CG allowance. 

........annual dividends ..........treated as Capital Gains, and are subject to CG tax, not income tax ?

Ciprico

....Colsten better hope the taxman can't track him down from this forum if he's been sheltering his share dividend income by his capital gains allowance.....

colsten

badger09 said:

colsten said:

Gains from shares (annual dividends as well as proceeds from sales) are treated as Capital Gains, and are subject to CG tax, not income tax. Everyone has an annual CG allowance. 

........annual dividends ..........treated as Capital Gains, and are subject to CG tax, not income tax ?

Are we saying the same thing?

colsten

jasmin5395 said:

thank you for all your replies. the investment wouldn't make any more than say 20k.

If that's a £20k gain, you certainly will have to pay CGT.