CGT offsetting

liamjames1

Hi,

Bit of a tax novice.

I bought 10k shares in an Irish company in Feb @19c. They are currently trading at 9-10c so if I cash in (I don't believe in the stock) I will have a capital loss of c5k

I also bought shares in another Irish listed company this year and am currently sitting on a c.13k gain. Assuming the standard rate if I closed today I would have a CGT bill of c. €4K on these payable in November.

Ignoring the €1270 allowance. Can I simply offset one against the other and won't have any tax liability?

Thanks

HcksawJimDuggan

The loss of 5k can be offset against the gain of 13k leaving you with a chargeable gain of 8K on which CGT will be calculated (ignoring the €1,270).

Just in case you plan on selling the shares in order to realise a tax loss and plan on purchasing them again straight away, revenue have an anti avoidance rule called the "bed and breakfast" rule.

liamjames1

HcksawJimDuggan wrote: »

The loss of 5k can be offset against the gain of 13k leaving you with a chargeable gain of 8K on which CGT will be calculated (ignoring the €1,270).

Just in case you plan on selling the shares in order to realise a tax loss and plan on purchasing them again straight away, revenue have an anti avoidance rule called the "bed and breakfast" rule.

Ah makes much more sense.

Thanks JD

jdmartinho

In the UK they try to match buy and sell orders within a 30 day window to cater for the "bed and breakfast" rule, but as someone mentioned Irish Revenue might have a similar rule, which means you would have to wait at least one month before buying back the same investment.