First Previous - Page 1 of 1 - Next Last

Sale of shares

  • Associate
  • Practice Licence
  • 114 posts
  • # 115930

I have client that has a portfolio of shares (c. £25k). What is the first step for them if they want to sell these? Also, they are not sure what the acquisition cost was, how does one go about finding out what this would have been for CGT comp purposes?

  • Member
  • 12 posts
  • # 115932

Hi - I presume the client holds the shares and they are not in an investment portfolio. If he/she does then obviously the shares will be sold through a stockbroker. If they don't know the costs of the shares they will be sold at nil cost so a bit of planning will be required to keep the gains below the annual exemption, currently £11,300.

If the shares were acquired as part of a privatisation the companies involved should have a history. This can be quite time consuming and complicated, for example British Gas with its corporate actions and splitting off of Centrica etc. The costs will also be more complicated if the client has taken shares instead of dividends as each of these will have there own costs through the years.

They could sell £11,300 worth on the 4 April and the rest on 6 April. This will give a gain on the 6 April of £2400 (£13,700 - £11300) taxable at 10 or 20% depending on your clients other income.

Hope that helps

 

 

  • Member
  • Practice Licence
  • 39 posts
  • # 115933

So any broker will sell them for you. Are they in paper form or held online? makes quite a difference in the cost for selling. A quick google will solve this for you, their are loads of brokers willing to sell them.

 

20 years ago I would have said -take them to your bank, they'll look after you!!

Look here for valuing them as it depends on how they were acquired:

https://www.gov.uk/tax-sell-shares/work-out-your-gain

 

toodle pipsky

  • Associate
  • Practice Licence
  • 114 posts
  • # 115934

Drew51 said:

Hi - I presume the client holds the shares and they are not in an investment portfolio. If he/she does then obviously the shares will be sold through a stockbroker. If they don't know the costs of the shares they will be sold at nil cost so a bit of planning will be required to keep the gains below the annual exemption, currently £11,300.

If the shares were acquired as part of a privatisation the companies involved should have a history. This can be quite time consuming and complicated, for example British Gas with its corporate actions and splitting off of Centrica etc. The costs will also be more complicated if the client has taken shares instead of dividends as each of these will have there own costs through the years.

They could sell £11,300 worth on the 4 April and the rest on 6 April. This will give a gain on the 6 April of £2400 (£13,700 - £11300) taxable at 10 or 20% depending on your clients other income.

Hope that helps

 

 


 TVM - Some of them are held individually and I think some of them are in an ISA portfolio. I undertand they can sell some of them themselves online over websites such as SelfTrade? All very useful TVM - I've been gathering information from variopus sources, and can go back to the client better informed! :)

  • Associate
  • Practice Licence
  • 114 posts
  • # 115935

AweltedSoul said:

So any broker will sell them for you. Are they in paper form or held online? makes quite a difference in the cost for selling. A quick google will solve this for you, their are loads of brokers willing to sell them.

 

20 years ago I would have said -take them to your bank, they'll look after you!!

Look here for valuing them as it depends on how they were acquired:

https://www.gov.uk/tax-sell-shares/work-out-your-gain

 

toodle pipsky


 Thanks. All v useful. 

  • Member
  • 12 posts
  • # 115936

Not a problem

ISA portfolio will be tax free as you probably know.

The client could transfer some of the other shares into there spouse name before sale and use both annual exemptions - the transfer will be at no gain/no loss and CGT free. 

  • Member
  • Practice Licence
  • 39 posts
  • # 115937

Funny things shares. Lots to consider.   clients can fall into the trap of letting the 'tax tail wag the tax dog'. Some of the decision making will depend on how urgently the money is needed clearly.

But perhaps to go into the decision making pot:

not all of the holding needs to be sold in one go. sell some to protect past gains.

are the shares about to go ex dividend - will a dividend be missed if they are sold at the wrong time

are they going up/down in value (consult Mr Gekko as we all know greed is good!)

can any be kept so the holder can take advantage of any share holder perks

 

and of course there is good old risk to consider. Is your life over and will you be getting  lunch from the bin on the street corner if their value falls to zero overnight (mind you even that comes with a tax break!)

Watch any advice given though as its regulated

 

First Previous - Page 1 of 1 - Next Last
loading