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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15977
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Hello, My company is currently going through an acquisition

Customer Question

Hello, My company is currently going through an acquisition that requires me to sell my shareholding. On deal completion the total monies due will be paid in 4 tranches over the next 18 months. Is CGT calculated at time of deal or would it be calculated on each payment received over the 18months which would effectively mean over 2 tax years.
Also my shareholding is made up of purchased and gifted shares. I realise that CGT is calculated on the gain on the purchased shares but what about gifted shares ?
Submitted: 4 years ago.
Category: Tax
Expert:  TonyTax replied 4 years ago.

If the price for your shares is set at the date of the disposal of your shares and is not contingent on future events such as profit targets being met, then the tax point is the date of sale. Any gain would be taxable in the tax year in which the date of sale occurs regardless of the payment arrangements. Take a look here and here for some relevant information on deferred sale proceeds.

The cost of the shares gifted to you is their value at the date of the gift. Shares are pooled as they are bought and de-pooled as they are sold or given away. Take a look here for information on the share identification rules.

I hope this helps but let me know if you have any further questions.