Transferring Shares to Children worried about getting Taxed

Keep_pedalling

LouiseAH said:

There is about £10,000 in profit on the shares at today’s value. Yes future estate will be above the threshold.

You can avoid CGT by gifting as much as will use up your annual CGT allowance now and the rest after April 5th. Personally IWould sell and gift cash rather then transfer the shares.

Just checking, you say the threshold have you included the resdencial NRB as well as your standard NRB taking your maximum exemptions to up to £1M?

Nomunnofun1

Keep_pedalling said:

LouiseAH said:

There is about £10,000 in profit on the shares at today’s value. Yes future estate will be above the threshold.

You can avoid CGT by gifting as much as will use up your annual CGT allowance now and the rest after April 5th. Personally IWould sell and gift cash rather then transfer the shares.

Just checking, you say the threshold have you included the resdencial NRB as well as your standard NRB taking your maximum exemptions to up to £1M?

Good point on the selling before gifting the proceeds. 

DRS1

Nomunnofun1 said:

DRS1 said:

LouiseAH said:

Nomunnofun1 said:

LouiseAH said:

There is about £10,000 in profit on the shares at today’s value. Yes future estate will be above the threshold.

If they are in joint names why not transfer half now and half after April 2025? You each would have a gain of £2500 in two tax years - nothing to pay. 

The shares will remain part of your estate if you die within seven years but that would remain the case if you didn’t gift the shares (as you would still hold them). 

However, you each have an annual gift exemption of £3000 PLUS £3000 if you didn’t gift last tax year. Another £3000 is available at 6th April. Total £18000. 

That might cover most of the gift proceeds. 

Thanks for the great info. What would happen if one of us passed away within 7 years of gifting the shares and the remaining partner lived longer than 7 years. Would the shares then not be part of the estate at the time of the remaining partner passing away and the estate being sorted out.

If you have got the gifts within the £3k exemption mentioned above then you don't need to worry about the 7 years.

Yes - but the value might be £30000 with the original cost £20000, for example. 

OK So in that case they have each given away £15K worth of shares.  For the one who dies within 7 years that £15k is part of the estate (although maybe you can set off £3k + £3k if the annual exemption for this year and last are available - so only £9k would count).  For the one who survives the £15k isn't part of the estate.  I have not checked but I imagine any change in value of the shares after that date of the gift is ignored.