Sharesave cgt on share sale 15 February at 11:08AM in Savings & investments 2 replies 140 views

Jakey30$

Hi hope someone can help me with this.
In 2008 I entered a 7 year sharesave scheme with the large holding company of the company I still work for which was subsequently sold to a management buy out team.
However although not in the scheme for as long as I would have hoped, due to the sale.
I was fortunate enough to acquire 1100 shares at a price of £7 , being a higher rate tax payer I gifted half to my wife whose only income is a state pension.
These shares are currently priced at around £120 so have obviously done very well.
Now with us both being in our early 70's I am considering we should be selling them, in order to realise their value whilst we're still here (I understand the allowance for cgt is dropping considerably from April, currently at £12,300 dropping to £6000)
My question is as these were acquired from a sharesave scheme are we subject to the cgt allowance?
Also what would the best way be to dispose of them( they are handled by computershare)

Sorry to be so long winded

frugalmacdugal

Hi,

sorry, can't answer your question, just amazed at the increase in share price.

So you got them for £7, what was actual share price then?

artyboy

Firstly, congratulations on such a dramatic gain - and I thought my Sharesave scheme was doing well (strike price £2.62c current market price >£6).

I'm a bit confused though - U.K. Sharesave schemes (also known as SAYE) run for 3 or 5 years, but you mentioned 7? That said if this was a true Sharesave scheme then:

1) yes, standard CGT allowances/rates apply - gifting to your wife is a smart move as you can take advantage of 2x the rate this year, next year and so on (although at the reduced £6000/3000 level). If you've not got other earned income, the rate is I believe only 10% so it's not all that crippling!

2) Assuming you have just acquired the shares, there is an allowance for you (just you, not your wife) to transfer £20k of them into a S&S ISA - assuming you've not already used your 22/23 ISA allowance? That would give you another route to sell down a chunk without any CGT - I'm not sure of the mechanics of this, but I'm sure computershare would know. It is different from 'bed and isa' though and must be managed as a direct transfer of shares into the ISA.

Would be interested to know what you end up doing as I'll be in a similar situation at the end of the year, although probably not with such a huge gain!