The Lemon Fool

I have some US stock that I would like to sell through broker to buy same stock into a stock and shares ISA - I know HMRC has a rule of 30 days for some investments to consider you effectively disposed of it - am I right thinking I can sell 20k of my US stock and buy 20k of same stock into an ISA without been liable to CGT? (assume purchase cost been <1k and CGT liability exists)

A second question - if I sell 40k of stock with CGT liability and gift 20k to my wife to put on an ISA of same stock - I understand CGT of those 20k does exist and tax is to be paid, is that assumption also right?

Thanks.

david wrote:I have some US stock that I would like to sell through broker to buy same stock into a stock and shares ISA - I know HMRC has a rule of 30 days for some investments to consider you effectively disposed of it - am I right thinking I can sell 20k of my US stock and buy 20k of same stock into an ISA without been liable to CGT? (assume purchase cost been <1k and CGT liability exists)

A second question - if I sell 40k of stock with CGT liability and gift 20k to my wife to put on an ISA of same stock - I understand CGT of those 20k does exist and tax is to be paid, is that assumption also right?

Thanks.

This was recently discussed on another thread and it would be worth your while to find it, but if you sell your US share and you have a capital gain you will be liable for CGT subject to the usual allowances as regards the tax free gain. You are planning to put the funds into an ISA but that is entirely irrelevant as far as possible CGT is concerned. The 30 day rule does not apply to this transaction.

For your second point there is some muddled thinking here as well. If you sell £40,000 of shares and any capital gain exceeds the tax free allowance you will be liable for CGT. It does not matter what you do with the proceeds; it is the initial transaction that counts.

You must separate the initial sale (which is a standalone transaction in both cases) from what you plan to do with the proceeds. Once the assets are in an ISA they are tax free but not until then.

Dod

Thanks Dod, appreciate the response and apologies I didn't find the exact discussion on this, surely didn't search enough. I'm happy to take the thread out to avoid noise in the forum and really grateful for your clarification.

AIUI if you GIFT half the shares to your wife before selling them (usually simple if you both have online accounts with the same platform), she acquires them at the price you paid initially. Thus when you sell you both can use your own CGT allowances up on the portion you hold.

https://www.gov.uk/capital-gains-tax/gifts

Paul

DrFfybes wrote:AIUI if you GIFT half the shares to your wife before selling them (usually simple if you both have online accounts with the same platform), she acquires them at the price you paid initially. Thus when you sell you both can use your own CGT allowances up on the portion you hold.

https://www.gov.uk/capital-gains-tax/gifts

Paul

That's right. I did this with one of my holdings this year.