Share selling advice from company share scheme, Also tax avoidance advise.

jules4485

Hi all, I have asked a similar question before but now I am after some additional advice as I my share scheme is close to maturing.

I entered a company share scheme a few years ago and am now close to the scheme maturing and me being able to get my hands on some money.

I put £250 a month from my wages into my companies share saving scheme so over the 3 years a total of £9000. The option on the share scheme was to buy the sahres at a price of £1.9334 per share. So if my calculations are correct this will give me 4665 shares.

Luckily over the past few years the company has done exceptional well and the current share price is £6.88 per share. I obviously want to get my hands on as much of this money as I can without having to give it all to the tax man.

Could anybody please advise if what I am about to write is correct and even legal.

So currently the shares are worth £32095.20.  I can withdraw upto £12300 myself with out paying captitol gains tax, I can gift my wife £12300 and she can sell them. So thats £24600. Am I also correct in thinking that my intial investment of £9000 is also with drawable tax free because I will have already paid the tax on this in my wages? I am sure somebody will jump all over me and tell me if im wrong but can I withdraw a maximum of £33600? I have calulated this at 2x£12300 and then the £9000 investment.

I understand that I will have to pay commision when selling my shares which I also need advise on. 

MX5huggy

What type of share scheme type are you in? 

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

The £9000 would not be CGT free. 

jules4485

MX5huggy said:

What type of share scheme type are you in? 

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

The £9000 would not be CGT free. 

Its a SAYE scheme

MX5huggy

Put them in a ISA then before cashing out. Sill got your ISA allowance for this year? 

milton1970

Once converted to shares on maturity transfer £20k worth of shares to a S&S isa - they will transfer at market value at point of transfer but watch out you only have 90 days for it to happen & there are a few forms usually. 

You also need to get a form from SAYE scheme manager confirming status of shares - this can be painful ...

Assuming you haven’t used this years isa allowance. 

Look for a cheap S&S isa for dealing .. e.g. iWeb don’t fall into Equiniti trap (high dealing costs)

The residual £12k in shares can then be traded & should fall below the CGT annual allowance. Again if with Equiniti transfer these to a GIA first to save fees when selling.

There are also options to partially transfer to partner / wife if above not possible.

Speed69

If you decide to sell your shares without the use of a tax efficient wrapper then the number of shares you can sell without needing to pay CGT is threshold / (sell price - buy price).

So in this example £12,300 / (£6.88 - £1.93) = 2484

So of the £17,089 you receive, £12,295 is profit (below threshold), while the other £4,794 is the money you invested.

As you state you can also transfer shares to your wife though I don't personally know the rules that apply when doing this.