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Do I need to pay CGT if I reinvest and don't withdraw the money?

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  • 27-01-2021 3:23pm
    #1
    cgtquest
    Registered Users Posts: 2 ✭


    Hi!

    I've made some gains on Revolute trading and I am just wondering, do I have to pay the CGT tax if I reinvest and do not withdraw the money?

    For example, I make €1200 gains from trading, and put that €1200 back into trading without withdrawing the money.

    I then make an additional €1700 gains. Therefore the total amount of gains I made is €2900, but after all trading I only made €1700.

    Since I am over the limit €1,270, do I need to pay tax on €1630 (2900-1270) or €430 (1700-1270).

    Essentially my question is, is every trade taxable once there are gains, or is it only taxable if I withdraw the money (transfer it to my bank).


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  • Options
    #2
    relax carry on
    Registered Users Posts: 4,072 ✭✭✭relax carry on


    cgtquest wrote: »
    Hi!

    I've made some gains on Revolute trading and I am just wondering, do I have to pay the CGT tax if I reinvest and do not withdraw the money?

    For example, I make €1200 gains from trading, and put that €1200 back into trading without withdrawing the money.

    I then make an additional €1700 gains. Therefore the total amount of gains I made is €2900, but after all trading I only made €1700.

    Since I am over the limit €1,270, do I need to pay tax on €1630 (2900-1270) or €430 (1700-1270).

    Essentially my question is, is every trade taxable once there are gains, or is it only taxable if I withdraw the money (transfer it to my bank).

    Capital Gains Tax (CGT) can occur on the sale, gift or exchange of an asset. Getting money into your account doesn't come into it. Keep in mind you also may have losses to use. You should be tracking each transaction to see if you are in a gain/loss position and if a chargeable event has occurred. It's your cumulative position over 12 months you need to keep and eye on.

    https://www.revenue.ie/en/gains-gifts-and-inheritance/transfering-an-asset/index.aspx


  • Options
    #3
    cgtquest
    Registered Users Posts: 2 ✭cgtquest


    Thank you!

    I will calculate my cumulative today.


  • Options
    #4
    Geuze
    Registered Users Posts: 13,110 ✭✭✭✭Geuze


    It doesn't matter what happens to the proceeds of a capital gain.

    What matters is whether or not a taxable capital gain occurred.


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