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bigduckontax, Accountant
Category: Tax
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I am looking to cash in some shares to fund an extension on

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Hi, I am looking to cash in some shares to fund an extension on my house. They are nominee shares that I was issued in an IPO so there is no associated cost to them. I am looking for the most tax efficient way to do this. Can you help?
Assistant: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: No, apart from my normal salary there isn't any other income to be considered.

Hello, I am one of the experts on Just Answer and pleased to be able to help you with your question.

The proceeds from the sale of these shares will be liable to Capital Gains Tax (CGT) at 10% or 20% or a combination of the two rates depending on your income including the gain in the tax year of sale. You have a non-cumulative Annual Exempt Amount (AEA), currently 11.3K to offset this gain. It is nearly March and the tax year ends on 5 April. If your gains are likely to be substantial then if you can stagger the sales over the 17/18 and 18/19 tax years you would have the advantage of two tranches of AEA.

I do hope that I have been able to show you a practical way forward in this matter.

I am responding to your question from a time zone 7 hours ahead of GMT. I am just about to go to bed and will reply to any follow-up queries you may have in the morning, my morning that is.

Customer: replied 6 months ago.
Thank you for your reply. You mention a combination of 10% and 20%. I am a higher rate tax payer so I would assume the majority will be the upper rate? I am looking to cash in approx £150k if it makes any difference? (Understand the time difference so tomorrow is fine)

In your case, it will all be at 20%, Jake.

Were you to cash in 150K in the current year then the bill would be 150K - 11.3K = 138.7K so at 20% that would be say 27.75K If you split it over the current year and next then in each year it would be say 75K - 11.3K = 63.7K 20% = say 12.75k. That times 2 would create a tax saving say 2.27K.

Please be so kind as to rate me before you leave the Just Answer site. You just caught me as I was shutting down my PC, Jake; good night!

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Customer: replied 6 months ago.
Thank you for your help. I have rated you.

Thank you for your support, Jake.