CGT Losses - How to use them effectively?

One More Toy

Anyone any advice? Its basically tax free money (an oversimplification I know)

daheff

well lets say that you had some shares with a gain (currently). Lets say that gain is 5K.

Lets say you are also carrying forward losses previously of 4K.

You have an annual exemption of 1,200 (give or take I think).


What you could do is dispose of your shareholding and then repurchase it straightaway.

this would give you a taxable gain of 5k, carried forward loss of-4K and exemption of -1.2K

Meaning you had an unused exemption of 200 EUR (5-4-1.2)**

Any future gains on the shareholding would then be taxed from the new entry price less any exemption.


If it was only a small loss/ large gain on holdings, you could wait until you close your position and use the carried forward losses then.



*My understanding is that the annual exemption is used first and then carried forward losses

One More Toy

daheff wrote: »

well lets say that you had some shares with a gain (currently). Lets say that gain is 5K.

Lets say you are also carrying forward losses previously of 4K.

You have an annual exemption of 1,200 (give or take I think).


What you could do is dispose of your shareholding and then repurchase it straightaway.

this would give you a taxable gain of 5k, carried forward loss of-4K and exemption of -1.2K

Meaning you had an unused exemption of 200 EUR (5-4-1.2)**

Any future gains on the shareholding would then be taxed from the new entry price less any exemption.


If it was only a small loss/ large gain on holdings, you could wait until you close your position and use the carried forward losses then.



*My understanding is that the annual exemption is used first and then carried forward losses

Isnt there some legislation of anti avoidance, you have to wait four weeks?

daheff

One More Toy wrote: »

Isnt there some legislation of anti avoidance, you have to wait four weeks?

I'm not aware of any?

TiGeR KiNgS

This is correct. It is called the Bed & Breakfast rule.
http://www.askaboutmoney.com/threads/should-i-do-a-bed-and-breakfast.93467/

Other Question
If you made a CGT gain under the €1,270 exemption do you have to notify Revenue ? i.e disclose on your annual tax return ?

One More Toy

TiGeR KiNgS wrote: »

This is correct. It is called the Bed & Breakfast rule.
http://www.askaboutmoney.com/threads/should-i-do-a-bed-and-breakfast.93467/

Other Question
If you made a CGT gain under the €1,270 exemption do you have to notify Revenue ? i.e disclose on your annual tax return ?

Yes I'm pretty sure you do