Bed & ISA prevents CGT ?

Just watched this YouTube video  https://youtu.be/eKQs3KVfaL0

unless I misunderstood the guy, I think he was suggesting that if you sold shares in a GIA and bought the exact same type back in an ISA within 30 days, then gains that would normally attract CGT would be avoided.. this is not what I’d previously understood but I’d be grateful if anyone could clarify please. 

Comments

  • poseidon1
    poseidon1 Posts: 1,046 Forumite
    1,000 Posts First Anniversary Name Dropper
    If you understood that bed and breakfasting a GIA investment into a stocks and shares isa triggers either a taxable gain or allowable loss ( at GIA level), then you understood correctly. I initiated a bed and breakfast into my Sipp this year  ( similar concept ), precisely to trigger a loss in the GIA account ( useful to shelter future GIA gains).

    Repurchasing the shares via your isa, fails one of the three requirements of the relevant CGT anti avoidance legislation, ie that you repurchased in the same capacity as you sold. Buying back in the ISA is not the same legal capacity as selling as outright beneficial owner. The ISA wrapper changes your capacity in that regard.

    The YouTube guy is  ( dangerously) wrong.  Sadly just one of the few comments  on the video picked this up.


  • Horracce
    Horracce Posts: 62 Forumite
    10 Posts Name Dropper First Anniversary
    edited 26 November 2024 at 11:16PM
    Thanks @masonic and @poseidon1 .. very reassuring :)
  • Sg28
    Sg28 Posts: 442 Forumite
    Third Anniversary 100 Posts Name Dropper
    poseidon1 said:
    dunstonh said:
    Very misleading video.  The FCA is currently cracking down on social media and influencers, mainly on referral links and advertising.   Maybe this is one they should look at for misinformation and referral links.

    look at all those:


    I gave the video a quick view and there are multiple errors in it.   e.g. assuming basic rate taxpayers will only pay 18% CGT.  The big one is assuming no tax on bed & ISA and assuming buying the same asset avoids it.  

    in the video he claims he was an ex financial adviser.   A check of the FCA register shows he worked for SJP for less than a year and investec for just over a month.   https://register.fca.org.uk/s/individual?id=003b000001mIguKAAS




    The worrying thing from my perspective, is more and more newbie investors are attracted to these so called financial pundits on YouTube, rather than researching and reading trusted sources.

     People seem to have shorter and shorter attention spans and prefer to be spoon fed important financial planning concepts by these armchair 'experts' , but with no way to differentiate between the competent and the charlatans.

    The original OP already had sufficient background knowledge to be suspicious, many others would not.
    Even more concerning is that (without watching this particular video) the guy may even know he is wrong.

    The nature of Youtube algorithms mean that if a video is interacted with by its audience, (as opposed to just viewed) then it will be further pushed to a larger audience. A great way to get people to comment on your video is to say something wrong. It incites people to react and feel the need to correct the error. Youtube doesn't care if the comments are good/bad/ugly. 


    Ex Sg27 (long forgotten log in details)

    Massive thank you to those on the long since defunct Matched Betting board.
  • sausage_time
    sausage_time Posts: 1,324 Ambassador
    Ninth Anniversary 1,000 Posts Name Dropper Photogenic
    edited 28 November 2024 at 9:28PM
    The disposal would definitely result in a gain/loss - irrespective on any purchase in an ISA.

    Here's some official confirmations from HRMC Community Forums
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