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  • FIRST POST
    • shade82000
    • By shade82000 5th Jan 18, 3:31 PM
    • 9Posts
    • 0Thanks
    shade82000
    SAYE into ISA
    • #1
    • 5th Jan 18, 3:31 PM
    SAYE into ISA 5th Jan 18 at 3:31 PM
    Hi all.

    I am looking for the most tax efficient way to cash out some shares from a sharesave scheme which just matured.

    It's still in the 90 day period so I can do that 'Bed & ISA' process now.

    The shares cost 9k and are worth ~34k today. I know I can't just sell the lot without paying CG tax.

    I have been told many different things about transferring to a share ISA and each time it's slightly different so now I'm even more confused.

    - I read in one place that there is no limit on the value transferred in but I don't pay tax on the first 15k profit.
    - I read in another place that I can't transfer more than 20k in share value (not profit) to an ISA but there is still a 15k profit threshold for tax.
    - I was thinking that I should move part of the shares into an ISA, less than 20k value with less than 15k profit. Cash that out, then just sell the rest as is with profits less than the CG limit. But then I read that I must transfer all the shares or none at all into an ISA and I can't split it. If that is true then it's a real shame.

    Normally I'd do a bit this year and a bit next year, but as my mortgage is coming up for renewal in March I'd like to do it before then, to decrease the LTV ratio and reduce the interest.

    So, can I split it and put part into an ISA and keep part in the existing account?
    Is the ISA tax limit completely separate from CG limit?
    If I can do both ways then is there an order that they must be sold - ISA first then normal ones, or the other way round?

    Any help, suggestions or experiences would be most appreciated!
    Thanks
Page 1
    • Alexland
    • By Alexland 5th Jan 18, 7:25 PM
    • 2,573 Posts
    • 1,955 Thanks
    Alexland
    • #2
    • 5th Jan 18, 7:25 PM
    • #2
    • 5th Jan 18, 7:25 PM
    There is no connection between the annual ISA contribution limits and your careful management of investment sales to avoid incurring capital gains tax liability.

    You are essentially selling the investments back to cash and then contributing the cash into your S&S ISA again in the same way you would contribute cash from any other source.

    There is also no reason you need to invest in the same shares as holding shares in a single company, however well they have historically performed, is highly risky. You may wish to consider investing in globally diversified assets using funds.

    Alex
    • Tom99
    • By Tom99 6th Jan 18, 2:17 AM
    • 2,241 Posts
    • 1,521 Thanks
    Tom99
    • #3
    • 6th Jan 18, 2:17 AM
    • #3
    • 6th Jan 18, 2:17 AM
    My understanding is that you can transfer up to 20,000 worth of shares into an ISA using this years ISA allowance within 90 days. You can then keep these shares in the ISA or sell then free of CGT.

    You will then only pay CGT on the shares sold outside the ISA which according to your figures would be worth 34k - 20K = 14K. These shares would have cost you 9/34*14=3,700.

    So your gain on the non ISA shares would be 14,000 - 3,700 = 10,300 which as this is below your 11,300 annual allowance would not be subject to CGT.

    I think you can also transfer SAYE shares into a pension or to a spouse but those options would not seem to be necessary.
    Last edited by Tom99; 07-01-2018 at 3:43 AM.
    • shade82000
    • By shade82000 10th Jan 18, 12:41 AM
    • 9 Posts
    • 0 Thanks
    shade82000
    • #4
    • 10th Jan 18, 12:41 AM
    • #4
    • 10th Jan 18, 12:41 AM
    Thank you for your replies, they were most helpful.

    So am I right in thinking that regardless of whether I transfer, buy, sell or otherwise use any ISA allowance, and regardless of whether I make any profit or not on any ISA, my CG tax allowance would remain at 11,300 and is completely separate from any ISA dealings?
    • Tom99
    • By Tom99 10th Jan 18, 6:27 AM
    • 2,241 Posts
    • 1,521 Thanks
    Tom99
    • #5
    • 10th Jan 18, 6:27 AM
    • #5
    • 10th Jan 18, 6:27 AM
    Thank you for your replies, they were most helpful.

    So am I right in thinking that regardless of whether I transfer, buy, sell or otherwise use any ISA allowance, and regardless of whether I make any profit or not on any ISA, my CG tax allowance would remain at 11,300 and is completely separate from any ISA dealings?
    Originally posted by shade82000
    That is correct, any income or gain in the ISA does not use any of your income tax or CGT allowance.
    • shade82000
    • By shade82000 10th Jan 18, 10:59 AM
    • 9 Posts
    • 0 Thanks
    shade82000
    • #6
    • 10th Jan 18, 10:59 AM
    • #6
    • 10th Jan 18, 10:59 AM
    Thank you so much for your help, it's really put my mind at rest.
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