Selling shares and capital gains tax

Gates87

Hi to anyone reading this and thank you for taking the time to do so.

I'm after some guidance regarding my holding of certificated shares that I would now like to sell.
The shares have been acquired over the last fifteen years or so through transfers, purchases and dividend reinvesting. For this reason I do not have the purchase price of some of my share certificates. As I see it, this leaves me with a problem regarding how Capital Gains Tax (CGT) would be calculated if applicable, when I sold .
I have tried to investigate this myself and have seen articles about Section 104 holdings, bed and ISA etc but its a financial minefield. As I said I am looking for guidance, a possible route to take not financial advice. If anyone thinks they may be able to help I would be very grateful.....thanks.

wmb194

Gates87 said:

Hi to anyone reading this and thank you for taking the time to do so.

I'm after some guidance regarding my holding of certificated shares that I would now like to sell.
The shares have been acquired over the last fifteen years or so through transfers, purchases and dividend reinvesting. For this reason I do not have the purchase price of some of my share certificates. As I see it, this leaves me with a problem regarding how Capital Gains Tax (CGT) would be calculated if applicable, when I sold .
I have tried to investigate this myself and have seen articles about Section 104 holdings, bed and ISA etc but its a financial minefield. As I said I am looking for guidance, a possible route to take not financial advice. If anyone thinks they may be able to help I would be very grateful.....thanks.

"Some of them." You could look at the share price chart for the last fifteen years and pick the lowest value but you don't have a rough idea of when you bought them for a better guess? How did you buy them? Could you get copies of the contract notes? Were the transfers from e.g., an inheritance?

Hoenir

What did you do with the contract notes?  Where were the shares transferred from? 

Gates87

Some of the shares were used to pay back a loan. So the shares were transferred with a certificate holding more shares than the loan value. Then I received a new certificate minus the transferred shares, thus no documentation of when the original shares were bought and at what price.

wmb194

Gates87 said:

Some of the shares were used to pay back a loan. So the shares were transferred with a certificate holding more shares than the loan value. Then I received a new certificate minus the transferred shares, thus no documentation of when the original shares were bought and at what price.

But you don't know what you paid for the shares on the original certificate? The price per share of the shares on the new certificate will be the same. The date isn't utterly critical.

DRS1

Are the shares publicly quoted?  If you know the date of acquisition can you use that to trace the share price on that date?
Quoted companies also publish data for dividend reinvestment somewhere - the annual report and accounts perhaps.

TheGreenFrog

Gates87 said:

Some of the shares were used to pay back a loan. So the shares were transferred with a certificate holding more shares than the loan value. Then I received a new certificate minus the transferred shares, thus no documentation of when the original shares were bought and at what price.

Share certificates do not (usually) state the issue price or acquisition price.  If you are holding shares in a private company then the company should have a record of the price at which any shares were issued to you and (maybe) a copy of the transfer form for shares transferred or sold to you (and the form should have the price on it.  If you received as a gift then the position will be a bit more complicated).  You will need to factor in any corporate actions like share splits (can look up at companies house record).

Gates87

You are right Greenfrog, there is no sell price on the certificates, just the dates the certificates were produced. I can find the price on these dates online, which are the dates the shares were transferred but it doesn't reflect the actual price when they were originally bought. I know in some cases it was considerably more than the 60pish that they are today.
I think I will just have to sell small amounts at a time to be on the safe side.
Thank you to those who replied it is much appreciated. 

jimjames

Gates87 said:

You are right Greenfrog, there is no sell price on the certificates, just the dates the certificates were produced. I can find the price on these dates online, which are the dates the shares were transferred but it doesn't reflect the actual price when they were originally bought. I know in some cases it was considerably more than the 60pish that they are today.
I think I will just have to sell small amounts at a time to be on the safe side.
Thank you to those who replied it is much appreciated. 

If they were bought at a price considerably more than today then surely there is no CGT due as you're making a loss?

dales1

Gates87 said:
I think I will just have to sell small amounts at a time to be on the safe side.

You probably know that you have a CGT annual exemption of £3,000 per year (at the moment).

So if you can sell just under £3,000 worth each year, then you can be certain that there will be no CGT due on those particular sales.

But if you can't dispose of all of your shares in this way, you will have to do some sums about the S104 holding.

It's really not difficult, so please come back for more info. 

In the few instances where you cannot get any data on the purchase price, you can just use zero and tell HMRC so in the comments box. (This will maximise the gain, but it will get you out of a data pickle).

Gates87

You're right but some were purchased by my ex and I,  in a work profit share scheme over 20 years ago. Thus transfers were made as part of a settlement, the original paperwork is lost so no proof of original purchase price.