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CGT question

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  • 24-11-2020 3:01pm
    #1
    icemanjimbo04
    Registered Users Posts: 144 ✭✭


    Hi all,
    I have recently started to invest some small savings around different stocks.

    Lets say I invest 1000€ in a few different companies.

    By the end of this year if those shares are worth 2000€ am i better to sell 1000€ worth to avoid paying tax on any future sale as 1000€ is within my exemption.

    If i dont sell any and the shares were worth 3000€ next year then would i be expected to pay cgt on the
    €730 profit minus my exemption?


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  • Options
    #2
    namloc1980
    Registered Users Posts: 18,064 ✭✭✭✭namloc1980


    You only have to pay CGT when you sell and the gain is above your annual exemption of €1,270 (assuming you have no other CGT gains in the year). So in your second example if you sell for €3k after buying them for €1k then your CGT bill would be €2k chargeable gain minus €1.27k CGT allowance = €730 x 33% = €241.


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    #3
    icemanjimbo04
    Registered Users Posts: 144 ✭✭icemanjimbo04


    namloc1980 wrote: »
    You only have to pay CGT when you sell and the gain is above your annual exemption of €1,270 (assuming you have no other CGT gains in the year). So in your second example if you sell for €3k after buying them for €1k then your CGT bill would be €2k chargeable gain minus €1.27k CGT allowance = €730 x 33% = €241.

    Thanks for the reply.
    So my best option would be pull the profit before years end to take advantage of my exemption and
    re-invest it in the new year.


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    #4
    Taylor365
    Registered Users Posts: 2,994 ✭✭✭Taylor365


    Sell and Buy for gain - yay :D

    Sell and Buy for loss - nay (must wait 5 weeks to buy same shares again) :(


  • Options
    #5
    Timmaay
    Registered Users Posts: 11,394 ✭✭✭✭Timmaay


    Taylor365 wrote: »
    Sell and Buy for gain - yay :D

    Sell and Buy for loss - nay (must wait 5 weeks to buy same shares again) :(

    I sold a decent few shares for a loss back in march, and I also had quite afew short term trades with both Tesla and NIO that were profitable, the likes of buying 10 Tesla and selling a week later for a 100$ share gain then another few days later I'd buy and sell more Tesla and so on. Overall I've a few hundred realised gains/losses across the year, and my total gains are several times the total losses. Anyone able to explain how I should handle that 5wk rule in this case?


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    #6
    Taylor365
    Registered Users Posts: 2,994 ✭✭✭Taylor365


    Timmaay wrote: »
    I sold a decent few shares for a loss back in march, and I also had quite afew short term trades with both Tesla and NIO that were profitable, the likes of buying 10 Tesla and selling a week later for a 100$ share gain then another few days later I'd buy and sell more Tesla and so on. Overall I've a few hundred realised gains/losses across the year, and my total gains are several times the total losses. Anyone able to explain how I should handle that 5wk rule in this case?
    No idea. I would guess you can't offset those losses against those gains.


    Whether it is only that stock, or all stocks, not sure.


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    #7
    cronos
    Registered Users Posts: 2,717 ✭✭✭cronos


    For those who are buying and holding mostly can you tell me do you usually sell enough each year to just get the 1200 euro tax break?


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    #8
    Timmaay
    Registered Users Posts: 11,394 ✭✭✭✭Timmaay


    Taylor365 wrote: »
    No idea. I would guess you can't offset those losses against those gains.


    Whether it is only that stock, or all stocks, not sure.

    From here:
    https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/selling-or-disposing-of-shares.aspx#:~:text=Shares%20sold%20within%20four%20weeks,acquired%20within%20the%20four%20weeks.
    Shares sold within four weeks of acquisition
    Shares bought and sold within a four-week period cannot be offset against other gains.

    You can only deduct the loss from a gain made on a subsequent disposal of same-class shares acquired within the four weeks.

    The 2nd line here is confusing me, the 1st line states that my short term losses (bought and sold within 4wks) can't be used to offset gains, which I'm clear with, however is the 2nd line specifically related to just thoses losses described in the 1st line, or to all trading losses? I would hope its in relation to losses in the 1st line only, and losses on shares that I held for longer than 4wks can be used to offset. I do have some Tesla losses that I realised within 4wks, however I then went on to buy more Tesla within another 4wks which I did make a gain on, so I can match up thoses at least lol. But yeh ugh this spreadsheet is going to get complicated, and the degiro tax report absolutely isn't sufficient in my case.


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    #9
    Taylor365
    Registered Users Posts: 2,994 ✭✭✭Taylor365


    I have no idea, which is why i avoid trading! :D

    I have just harvested a number of losses on long positions to offset my gains to avoid any CGT this year. I have no plans to invest back in those stocks though.


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