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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5147
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Eight years ago I invested my severance of £78,000. I now need

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Eight years ago I invested my severance of £78,000. I now need to sell and they are worth £108,000. I earn £30k a year my husband is a pensioner.
What will I need to pay on my inverstment?
Hello and welcome to the site. Thank you for your question.

If you have made a capital gain from this investment, then the gain is chargeable to capital gains tax.

You say the investment is worth £108k giving you a gain of £30k.
After capital gains allowance of £11k the remainder (30-11) £19k would be subject to CGT at a combination rate of both 18% and 28% as you have an income but it is below the threshold for higher rate tax. Some £12k would be taxed at 18% and the remained £7k at 28%.

You could mitigate this tax by transfer some of the investment to you husband before eventual sale as transfer of assets between spouses are tax neutral, i.e. no gain or loss at the time of transfer.. deemed to have transferred at cost price.

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. and other Tax Specialists are ready to help you
Customer: replied 3 years ago.

The shares are actually in joint names so does this make it better for us?

Thank you for your prompt reply.

As the shares are in joint names, you both get capital gains allowance in your own right, so only £8k is taxed. This would be taxed at 18%...equating to £1,440 of CGT.

I hope this is helpful.
I thank you for accepting my answer.

Best wishes.