CGT offsetting

liamjames1 · 12-09-2016 05:28PM #1

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 · 12-09-2016 05:44PM

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 · 12-09-2016 06:07PM

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 · 19-09-2016 09:45AM

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.

CGT offsetting

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