Capital Gains Tax

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Capital Gains Tax

Post by FiF @ Fri Mar 07, 2008 3:23 pm

Can somebody give me the SP on CGT please.

Scenario we (Me & Mrs) have a fair wodge in Invesco Perpetual High Income Accumulation account set up in trust for Miss FiF when she went to uni. We used to be able to claim the tax paid back under her name until Gordon Brown stopped it. :evil:

Well my ill-begotten daughter is well on track to achieving her usual high standards, (several exams with 100% mark) :shock: and is clearly going to uni.

Problem is if we transfer this share holding into her name will I be liable for CGT, or what is the limit?

Reason I ask is that last year I made a (expletive deleted) bundle and wondered if timing the transfer after new tax year might ease the blow if any.

Reason I made a bundle was a one off, I was officially appointed into command of a unit that I'd been acting head of for a few years. Yes canteen joke ; we have more actors than equity.

Anyway part of the deal negotiated was that I would get several years back pay and increases and agreed bonuses which I was entitled to but had not got due to management numptyism.

So question is, is there a lower limit below which CGT does not apply, bit like initial tax free bit in income tax etc.

Should my transfer of an account held by me in trust for be exempt CGT or?


PS before anybody says it. :Worst my kid is clever thread ever: Yep and proud of her even so. :D
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Re: Capital Gains Tax

Post by Dirk @ Sun Mar 09, 2008 11:17 pm

I am not a professional in this area but as no-one else has posted (you may want to ask outside law TBH).


http://www.direct.gov.uk/en/MoneyTaxAnd ... DG_4016313
How CGT is worked out

CGT is worked out for each tax year (which runs from 6 April one year to 5 April the following year). It is charged on the total of your taxable gains, after taking into account:

* certain costs and reliefs that can reduce or defer gains
* allowable losses you have made on assets to which normally CGT applies
* the annual exempt (tax-free) amount (the AEA) - this is ££9,200 for every individual in the tax year 2007-2008

* More about CGT allowances on the HMRC website (opens new window)
* CGT - detailed introduction including how to calculate gains and losses (opens new window)
* Help with PDF files

CGT rates

How much CGT you pay depends on your overall income. Your total taxable gains are added to your taxable income for the year and treated as the top part of that total. The gains are then charged to CGT at the following rates (2007-2008 tax year):

* 10 per cent where they fall below the starting rate limit for Income Tax (££2,230)
* 20 per cent where they fall between the starting rate and basic rate limits for Income Tax (££2,231 to ££34,600)
* 40 per cent where they fall above the basic rate limit for Income Tax (££34,601 and above)

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Re: Capital Gains Tax

Post by FiF @ Mon Mar 10, 2008 5:56 am

Thanks Chris, tbh I'd left it because we have a legal strategy , amazingly enough, which will mean Miss FiF gets her full amount of wonga, and as for the chancellor?

You can go swivel, Darling!


.......^^^^^....... Technical Financial terminology. :twisted:
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Re: Capital Gains Tax

Post by Mr Obertshaw @ Mon Mar 10, 2008 12:35 pm

Have you seen your daughters marks on the Uni computer system where they are usually published? My parents reckon I scored 100% in a few exams in January however the reality is a good 40% lower than that. Us Uni students are good at securing cash!
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Re: Capital Gains Tax

Post by FiF @ Mon Mar 10, 2008 2:46 pm

Was going by the results sheets from AQA / EdExcel etc, which give the grade and the marks and eg 90/90 looks like 100% to me but then suspect it may be the unified scoring system so I knows what you mean.

Mind you the little bugger knew that subject backwards, or she did when I tested her on it during revision, so who knows exactly tbh.
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Re: Capital Gains Tax

Post by Mr Obertshaw @ Mon Mar 10, 2008 3:33 pm

FiF wrote:Was going by the results sheets from AQA / EdExcel etc, which give the grade and the marks and eg 90/90 looks like 100% to me but then suspect it may be the unified scoring system so I knows what you mean.

Mind you the little bugger knew that subject backwards, or she did when I tested her on it during revision, so who knows exactly tbh.



Ohh sorry just re read your opening post and realised shes not already at uni so must be doing A levels. If the edexcel or AQA things say 90/90 she did indeed get 100% congrats!
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Re: Capital Gains Tax

Post by dirtyboy @ Mon Mar 10, 2008 4:28 pm

FiF wrote:Can somebody give me the SP on CGT please.

Scenario we (Me & Mrs) have a fair wodge in Invesco Perpetual High Income Accumulation account set up in trust for Miss FiF when she went to uni. We used to be able to claim the tax paid back under her name until Gordon Brown stopped it. :evil:

Well my ill-begotten daughter is well on track to achieving her usual high standards, (several exams with 100% mark) :shock: and is clearly going to uni.

Problem is if we transfer this share holding into her name will I be liable for CGT, or what is the limit?

Reason I ask is that last year I made a (expletive deleted) bundle and wondered if timing the transfer after new tax year might ease the blow if any.

Reason I made a bundle was a one off, I was officially appointed into command of a unit that I'd been acting head of for a few years. Yes canteen joke ; we have more actors than equity.

Anyway part of the deal negotiated was that I would get several years back pay and increases and agreed bonuses which I was entitled to but had not got due to management numptyism.

So question is, is there a lower limit below which CGT does not apply, bit like initial tax free bit in income tax etc.

Should my transfer of an account held by me in trust for be exempt CGT or?


PS before anybody says it. :Worst my kid is clever thread ever: Yep and proud of her even so. :D


Okay, just spotted this, don't know why I was nosing in here, legal stuff? Anyway.

Initially, it appears it's just a unit trust type account set up with MissFiF as the name held in trust. Therefore, any disposal would be subject to 'her' personal allowances and exemptions. However, this may be different, should the disposal be made before she is 'entitled' to the fund in accordance with the opening terms and conditions. Ie Probably 18 years old. In which case, you and the wife, 'may' be liable.

The CGT calculation takes into account a number of factors, length held, cost etc.

Any disposal of less than ££30,000 where there is no gain need not be reported.

The annual gains exemption per individual for 2007/08 is ££9,200. After indexation (if applicable) and taper relief, the gain will be taxed as a top slice of income at savings rates - ie 10%, 20% or 40%. If assessable only on your daughter, I'll assume she's not working, so ££5,200 over and above the ££9,200 would not be taxable without taking into account any reliefs etc.

If it's a bona-fide trust fund, the rules can be quite complex, the annual expemption is ££4,600 and the remainder is taxed at 40% after being reduced by taper relief.

I'm not too sure what type of income you have from the 'back pay etc' you mention is? Is this just an additional PAYE remuneration package or were you given some equity to dispose of thus creating a gain?

Perhaps some more info on the type of account etc?

This is a little rushed, sorry, now got a client in, so will go over this in an hour or so.
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Re: Capital Gains Tax

Post by FiF @ Mon Mar 10, 2008 10:57 pm

OK thewave thanks for that very informative.

I'm not at home home so a little difficult to answer without looking back at the original papers.

It's not a bona-fide trust fund, as you put it so that complication can be ignored.

iirc it's a simple unit trust with her name set up as the name held, it's shown on the statement, and the Revenue, as they were then, always were happy for me to make claims for the tax paid on her behalf. Cannot recall the age written in but I guess 18 , need to look at copy original papers.

On my side the backpay etc etc was just simple PAYE wonga.

Back to CGT For a start the free transfer between husband and wife gets rid of the 40% element from my marginal tax level.
Also it appears it qualifies for max taper relief.

Have to wait till weekend and I can look at original papers.
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Re: Capital Gains Tax

Post by dirtyboy @ Tue Mar 11, 2008 11:14 am

FiF wrote:OK thewave thanks for that very informative.

I'm not at home home so a little difficult to answer without looking back at the original papers.

It's not a bona-fide trust fund, as you put it so that complication can be ignored.

iirc it's a simple unit trust with her name set up as the name held, it's shown on the statement, and the Revenue, as they were then, always were happy for me to make claims for the tax paid on her behalf. Cannot recall the age written in but I guess 18 , need to look at copy original papers.

On my side the backpay etc etc was just simple PAYE wonga.

Back to CGT For a start the free transfer between husband and wife gets rid of the 40% element from my marginal tax level.
Also it appears it qualifies for max taper relief.

Have to wait till weekend and I can look at original papers.


In all likelyhood, it'll probably be in her name at 18. Any gain would be taxable on her on the savings rates.
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