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taxadvisor.uk
taxadvisor.uk, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 4996
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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In 2014 the company I work bought by another

Resolved Question:

Hi,
In 2014 the company I work for were bought by another company. I had some share options with the company. On completion I received roughly 80% of the share options as Cash and the rest as loan notes. I have not yet received any money from these loan notes. (As an aside, my CG is eligable for ER relief)
I'm currently finishing my tax return and adding the CGT I own on the cash part (80%) of the sale.
There are two fields in the capital gains part of my tax return in the 'Unlisted shares and securities' section:
1. Disposal Proceeds
2. Allowable costs (including purchase price)
So, my question is :
Should the disposal proceeds only relate to the cash part of the proceeds (80%) or should it be all the disposal proceeds of the sale? So let's say if the total disposal proceeds are £100,000 should I only add £80,000 in the tax return because I'm only paying the tax on the 80% cash I received?
The same question applies to the purchase price : Should I only put in 80% of the purchase price that relates to the Cash Part?
I'm sorry if I can't be clearer.
Submitted: 1 year ago.
Category: Tax
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your question..You are correct in your understandingMore information on this can be found under "You must pay capital gains tax on any cash you get as part of the takeover" herehttps://www.gov.uk/guidance/capital-gains-tax-share-reorganisation-takeover-or-merger I hope this is helpful and answers your question.If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.
Customer: replied 1 year ago.
Thanks for the reply.Out of the 80% cash I received, a small amount (roughly £1000) was used to cover legal fees. I have added these fees to the "Allowable Costs (including purchase price)" field on my tax return. Is this OK?
Expert:  taxadvisor.uk replied 1 year ago.
Thank you for your reply.It is okay to include these legal costs. I hope this is helpful and answers your question.If there are no more issues, I will appreciate if you would kindly rate my service/accept the service I have provided before you leave the site, to ensure I get credited for it by Just Answer.
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