Stocks Shares and Capital Gains Tax (2022/2023)
Discussion
Hoping for someone who understands the tax liabilities of trading shares could shed some light on this for me……..
My understanding is if you buy shares and later sell them at a profit you are liable for CGT when you sell them, is this correct? I believe the CGT allowance for the current 2023/2023 year is £12,300 and I have not used any of it on anything else.
In round figures I currently have two stocks which are currently £10,000 and £2,000 up, so assuming that doesn’t change I could cash them in today showing a £12,000 profit between them.
Would I be right in saying if I did that and stuck those in my SA I would have no tax to pay?
If I were then to buy them back tomorrow (happy to keep them) for £12,000 would I have successfully bagged that CGT allowance? Thus leaving myself less tax exposure in the future if they continue to increase in value?
I may have got this completely wrong in which case I would be grateful if somebody could explain how actually this works.
Many thanks in advice for any input.
My understanding is if you buy shares and later sell them at a profit you are liable for CGT when you sell them, is this correct? I believe the CGT allowance for the current 2023/2023 year is £12,300 and I have not used any of it on anything else.
In round figures I currently have two stocks which are currently £10,000 and £2,000 up, so assuming that doesn’t change I could cash them in today showing a £12,000 profit between them.
Would I be right in saying if I did that and stuck those in my SA I would have no tax to pay?
If I were then to buy them back tomorrow (happy to keep them) for £12,000 would I have successfully bagged that CGT allowance? Thus leaving myself less tax exposure in the future if they continue to increase in value?
I may have got this completely wrong in which case I would be grateful if somebody could explain how actually this works.
Many thanks in advice for any input.
Couple of things:
1. If the gains are less than the annual allowance you won’t have to report them on your SA. (Unless you have large gains in the prior three years that would bring the average above the allowance).
2. You don’t get to bag the gain by buying the same stock back next day. You need to be out 30 days at least or the basis will resume to the price of the initial lot.
1. If the gains are less than the annual allowance you won’t have to report them on your SA. (Unless you have large gains in the prior three years that would bring the average above the allowance).
2. You don’t get to bag the gain by buying the same stock back next day. You need to be out 30 days at least or the basis will resume to the price of the initial lot.
Kirkmoly said:
Couple of things:
1. If the gains are less than the annual allowance you won’t have to report them on your SA. (Unless you have large gains in the prior three years that would bring the average above the allowance).
2. You don’t get to bag the gain by buying the same stock back next day. You need to be out 30 days at least or the basis will resume to the price of the initial lot.
Thanks for that.1. If the gains are less than the annual allowance you won’t have to report them on your SA. (Unless you have large gains in the prior three years that would bring the average above the allowance).
2. You don’t get to bag the gain by buying the same stock back next day. You need to be out 30 days at least or the basis will resume to the price of the initial lot.
1. Not sold any shares before so that covers the second part. I seemed to remember there is a section on the SA to fill in any capital gains, am I wrong or does that not apply to shares?
2. Is there any reason I cannot buy other shares with the £12000, or does that only apply to buying back the same stock?
This sounds even easier than I was expecting.
There are two reporting requirements for CCT on your SA.
1. The first is if the total capital gain exceeds the allowance of £12,300 which is well covered in above earlier posts.
2. The second is if the total value arising from the sale exceeds 4 x the allowance of £12,300, ie £49,200.
This second requirement is there even if you do not exceed the CGT allowance of £12,300.
R.
1. The first is if the total capital gain exceeds the allowance of £12,300 which is well covered in above earlier posts.
2. The second is if the total value arising from the sale exceeds 4 x the allowance of £12,300, ie £49,200.
This second requirement is there even if you do not exceed the CGT allowance of £12,300.
R.
PabloEscortCar said:
hanks for that.
1. Not sold any shares before so that covers the second part. I seemed to remember there is a section on the SA to fill in any capital gains, am I wrong or does that not apply to shares?
2. Is there any reason I cannot buy other shares with the £12000, or does that only apply to buying back the same stock?
This sounds even easier than I was expecting.
Only applies to buying back the same stock. You can buy other stock as soon as you wish.1. Not sold any shares before so that covers the second part. I seemed to remember there is a section on the SA to fill in any capital gains, am I wrong or does that not apply to shares?
2. Is there any reason I cannot buy other shares with the £12000, or does that only apply to buying back the same stock?
This sounds even easier than I was expecting.
So for the purposes of proving I have understood ……….
I can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
I can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
PabloEscortCar said:
So for the purposes of proving I have understood ……….
I can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
Yes that is rightI can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
leef44 said:
PabloEscortCar said:
So for the purposes of proving I have understood ……….
I can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
Yes that is rightI can sell shares making £12000 profit in 2022/2023 and just forget anything about reporting it.
When the funds clear I can do what I like with the money.
However, I cannot buy the same shares again within 30 days without messing the whole plan up.
So if I made £13000 profit, I would have to declare them and pay CGT on the £700?
Is the above right?
Sorry edited to say I see The Leaper has already mentioned this earlier.. as you were!
Edited by JagYouAre on Tuesday 7th March 13:59
supersport said:
Ooh, that’s seems clever. I never thought of that. If you sell from an after tax account to use up some CTG allowance then repurchase immediately but in a tax sheltered account I guess you would be free and clear because the cost basis in an ISA or SIPP doesn’t matter?
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