CGT calc

[gingerjedi]

All in wife's name, she works part time so earning <10k.

Investment returns £20,000
-£10,600 exemption
-£2,000 original investment
=£7,400 taxed @18%

Leaving £18668

Have I got this right?

[Craig@Clarity]

All in wife's name, she works part time so earning <10k.

Investment returns £20,000
-£10,600 exemption
-£2,000 original investment
=£7,400 taxed @18%

Leaving £18668

Have I got this right?

You've got the right answer

[gingerjedi]

Thanks Craig.

Is there any way to further reduce the liability? Unfortunately its one cash lump so we cant split it over 2 tax years.

[Craig@Clarity]

Based on the information you've given and assuming your wife was the sole investor, I don't think there is anything further. It looks as simple as you've presented it. Look at it this way though. She's paying about 13.5% tax on the gain overall (£1,332 of £18,000).

If the original investment was held jointly then you'd have 2 lots of AEA to use up.

[Punter]

Thanks Craig.

Is there any way to further reduce the liability?

Yes. She can gift some, say half, of the shares to you if you have unused allowance. Transfers between spouses are free. There will then be no CGT to pay. You can download a stock transfer form.

[Craig@Clarity]

Yes. She can gift some, say half, of the shares to you if you have unused allowance. Transfers between spouses are free. There will then be no CGT to pay. You can download a stock transfer form.

I'd be cautious if the investment and disposal has already happened and you're doing it retrospectively.

[DonkeyRhubarb]

Based on the information you've given and assuming your wife was the sole investor, I don't think there is anything further. It looks as simple as you've presented it. Look at it this way though. She's paying about 13.5% tax on the gain overall (£1,332 of £18,000).

If the original investment was held jointly then you'd have 2 lots of AEA to use up.

Assuming he hasn't already used up his CGT allowance, can his wife not gift half of the investment to him eg. by putting it in joint names? If this is permitted, it would avoid tax altogether.

[gingerjedi]

If the original investment was held jointly then you'd have 2 lots of AEA to use up.

It was effectively a joint investment but in her name only as it was a management buyout.

We've had the cheque so I guess there's nothing I can do now.

Thanks for the advice guys.