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TonyTax
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My wife and I have separate Unit Trust investment accounts

Resolved Question:

My wife and I have separate Unit Trust investment accounts and our total Capital Gains this year are currently as follows
A B A+B
Realised CG 2369 -1198 1171
Unrealised CG 13642 2539 16181
Totals 16011 1341 17352
Objective is to take advantage of CGT allowance of £11000 each. Is the following the best, ***** ***** legal way of doing this?
A gifts (by stock transfer) unit trusts with CG value of £5000 to B this being at cost value ie CG of £5000 transferred to B
A then sells units needed to achieve the £11000 CG allowance
B then sells units needed to achieve the £7539 CG available
Both A and B wait 31 days before rebuying.
All sale funds go into a joint account. Is this a problem or an advantage?
Is there any convenient way of avoiding waiting for 31 day for repurchase?
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi.

You cannot avoid the wait of 31 days to repurchase units you sold within the previous 30 days if you want to avoid the matching of those transactions.

Transfers of assets between the parties to a marriage are tax neutral, ie no gain, no loss, so there is nothing to stop A transferring to B sufficient units for B to realise gains to utilise their annual CGT exemption. They would then need to wait 31 days to repurchase units. B takes the cost of the units to A as their base cost.

Using a joint bank account makes no difference to the CGT treatment.

If possible, you need to avoid doing this with units in a unit trust in which the recipient already has units as you may not achieve the desired effect.

I hope this helps but let me know if you have any further questions.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15763
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
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