Labour overhauled capital gains tax in 2008, when, it scrapped taper relief – which reduced the taxable gain according to the length you’d owned the asset – and, instead, introduced a flat 18pc tax on gains. This would mean that a widow whose husband bought shares in the Eighties, for instance, would have to pay CGT on the full gain on those shares whenever she sells them so even in the current climate you can see how big the sums might be. the Tories subsequent main change to CGT has been to make it pay more, from the year 2010-11, the capital gains tax rate payable by higher- and additional-rate taxpayers jumped from 18pc to 28pc.
To limit your liability there is no shortcut to the hard work of monitoring your portfolio closely and every year crystallising gains up to the maximum CGT-free limit (£11,100 for this tax year). To achieve this when shares suddenly plunge in value you can sell more while remaining within your annual CGT allowance. This doesn’t mean you can’t continue to own the same investments: you could sell your directly held shares or funds then immediately repurchase them through your ISA at the same or similar price. Or, if you’re married, your spouse could repurchase them in his or her name. Enable’s IFA’s in Bishop’s Stortford can help you work on making the best of your CGT liability.
Issued by: Enable Independent Financial Life Planners 25c North Street, Bishops Stortford, Herts CM23 2LD Telephone: 01279 755950 - Fax: 01279 657339 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE
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