Keeping record of purchased NYSE stocks

hermante

Langtang said:

Very interesting thread, thank you. I know nothing about investing or share buying at all, but we will be inheriting c2500 shares in a major US Oil Co that were accumulated over 2 decades working for a company - buying shares monthly from salary and getting the equivalent number of shares from the company - with that company then being bought out later by a bigger US Oil Co ( the dividend from these had been used to top up my FIL's pension for the last 20 years, and we would have a plan to do similar in the years ahead).

The paper trail of when they were bought, how much was paid, how many free shares were given and the exchange rate of old company shares to new company shares have been meticulously documented in a simple spreadsheet by my FIL.

The explanation of how to figure out how much they are worth on average is a revelation, as I have always been under the impression that you had to figure out which shares you were selling, when you bought them, how much for and how much they are worth now to figure out if you're liable for CGT. It appears to be much simpler than that, so thank you.

I would probably have plenty of questions to ask in the weeks and months ahead but my initial one would be should I move some of these into a S+S ISA?

We will, of course, be speaking with a financial advisor over the next while and I am sure we will get invaluable advice from them, but it's good to get a feel for what others would do here.

The first question you should ask yourself is whether you want to invest in this major US oil company?
Say the shares are worth £10000. If you had £10000 in your bank account right now, would you choose to put it into this US oil company?

I personally am staying clear of anything to do with fossil fuels, but if you believe that investing in a US oil company is likely to yield a better return than anything else you could do with the same amount of money, then that is your decision.

Your FIL's spreadsheet is not relevant to you. It is relevant to the executors of his will. For your purposes, you simply "paid" the value of the shares on the day you inherited them. You would be liable for CGT on any gain you made between the date you sell the shares and the date you inherited the shares.

Firstly you would get your broker to register the shares in your name. If you wish to invest the inheritance in something else, then simply sell the shares. Unless the gain is more than £12300, there would be no tax to pay. If the total value of the shares is less than £49200, there is no need to report the sale to HMRC either. (But if you made other taxable gains or losses in the current tax year, for example selling an investment property, then it's different.)

If you wish to retain the shares, then you would still sell them up to £20000 worth (and be liable for CGT, but probably no action needed as described above), then deposit the money into an ISA and rebuy them. Each year you would then sell another £20000 worth. Your broker may offer a process called "bed and ISA", but this can take a few weeks and it may be simpler to do it manually.

Langtang

@hermante thank you very much for your detailed reply. It is very much appreciated. 

I am a complete novice when it comes to investing. As Manuel would say “I know nothing” 

I had at one point thought about buying some when they dropped in value to around the 60 dollar mark, but dithered too much. 

I have always gone by what my FIL said, that the dividend that these shares produced (Chevron) was very good over the longer period. I really would have no idea whether there is an alternative way of making more - not that making more is a “huge” priority (more of that in a later, longer post). 

Thanks also for the insight into transferring the shares into an ISA. I had naively thought you could just transfer them, as you do with cash. Would keeping the shares in an ISA be a way of doing away with the US & UK taxing system - the so called withholding tax - which my FIL said was a pain in the .....

As a matter of interest, why would the spreadsheet be of value to the solicitors? Shares started out as Texaco ones, then morphed into Chevron ones. Would that have a bearing on the final figure?

I would be interested to hear why you are staying away from fossil fuels. Is it a financial reason, do you think the market is on the down slide or is it more an ethical or environmental one?