Capitol Gains Tax - can't work out the 'gain'

Tree_pipe99

I have shares in a company I used to work for and looking to sell them. My problem is that I don't have access to the info that would tell my how much I paid for them (over about a 10 year period), in order to work out what (or if) any gain was made on them, for CGT purposes.

If I just sell them and do nothing, would HMRC contact me about it, or is there something I can do proactively, even though I don't know what gains I might have made?

grimsalve

If the gain is over the £3k annual allowance then HMRC could charge you interest and penalties.

Where are the shares currently held? Are they with a broker? Do they have any information about when you bought them, how many shares you purchased, the value at the time, etc.?

Tree_pipe99

grimsalve said:

If the gain is over the £3k annual allowance then HMRC could charge you interest and penalties.

Where are the shares currently held? Are they with a broker? Do they have any information about when you bought them, how many shares you purchased, the value at the time, etc.?

The shares are split between 2 different brokers (currently worth about £15k). I paid a monthly fee, taken directly from my salary, over about a 10 year period, at a favorable rate as I worked for the company.

I had to move them to external brokers when I left the company about 5 years ago. The brokers don't have info on when or how much I bought them for.  

My best guess is that I might have made a small profit, but probably not over the CGT threshold, but it could be over. I'm guessing HMRC will put the onus on me to prove it isn't over the threshold? What happens if I can't?

InvesterJones

Tree_pipe99 said:

I have shares in a company I used to work for and looking to sell them. My problem is that I don't have access to the info that would tell my how much I paid for them (over about a 10 year period), in order to work out what (or if) any gain was made on them, for CGT purposes.

If I just sell them and do nothing, would HMRC contact me about it, or is there something I can do proactively, even though I don't know what gains I might have made?

If you commit fraud (regardless of accidental or not) then bad things may happen. You could ask the company if they have any records of the scheme that would indicate what discount if any you bought them at compared to the market price. But if you don't have a record of when you bought them exactly it might be simpler to assume that you bought them for 0 and sell them off in chunks of £3000 per tax year.

masonic

The opening gambit might be 100% of the value is capital gain. The more information you have, the more you can adjust towards the actual position. What information is included in your payslips?

At present you could sell over 5 tax years with peace of mind it will not exceed the allowance.

Tree_pipe99

Thank you for suggestions. I'm not in any hurry, and I don't expect the value of the shares to increase for the foreseeable, so selling £3k per year sounds like the safest option. 

InvesterJones

Tree_pipe99 said:

grimsalve said:

If the gain is over the £3k annual allowance then HMRC could charge you interest and penalties.

Where are the shares currently held? Are they with a broker? Do they have any information about when you bought them, how many shares you purchased, the value at the time, etc.?

The shares are split between 2 different brokers (currently worth about £15k). I paid a monthly fee, taken directly from my salary, over about a 10 year period, at a favorable rate as I worked for the company.

I had to move them to external brokers when I left the company about 5 years ago. The brokers don't have info on when or how much I bought them for.  

My best guess is that I might have made a small profit, but probably not over the CGT threshold, but it could be over. I'm guessing HMRC will put the onus on me to prove it isn't over the threshold? What happens if I can't?

Do you know how much the monthly fee was? That should enable you to work out your purchase price, but if you're not sure, spread the sale out over tax years and give yourself a margin.

Vitor

HMRC’s Capital Gains Manual CG15250 explains that estimates are acceptable where exact figures are not available, provided they are reasonable and properly evidenced.

DRS1

Can you remember if the shares were bought under a tax approved share scheme?  Perhaps an SAYE Scheme or Sharesave scheme (the same thing but the names may ring a bell?) or a Profit Sharing Scheme or Share Incentive Plan?

If you used such a scheme you may not need to look at share prices every month for 10 years but just when eg you exercised the SAYE Option or took the shares out of the Share Incentive Plan.