There are a number of checks to ensure you minimise CGT coming up to the tax year end:
Have you used your (and your spouse’s) tax-free annual exemption of £11,000 this year?
If not, look to crystallise gains before 5th April to utilise this or it will be lost.
Consider tax-free transfers of assets pregnant with gains between married couples to ensure that both annual exemptions are utilised –‘bed and spouse’. It could mean gains of up to £22,000 are tax-free.
You can also ‘bed and ISA’ and ‘bed and SIPP’ by selling assets to realise gains/crystallise losses
and buying them back in your Isa or pension fund.
If you have capital gains over £11,000 already, consider crystallising losses to reduce gains.
If any of your investments or assets are of negligible value, consider making a claim for the loss to reduce current year gains.
EIS investments (as outlined in our earlier blog) can be used to defer/avoid CGT and provide additional IHT benefits. Capital gains that are rolled into Seed EIS shares qualify for a permanent 50% CGT exemption. If you have income tax and CGT liabilities this tax year you could consider an EIS investment if you are happy with the extra investment risk and tying capital up for three years.
This is only a case study and does not constitute advice. Anyone considering any form of financial planning should seek independent financial advice.
First Wealth LLP is an appointed representative of Best Practice which is authorised and
regulated by the Financial Conduct Authority (FCA). You should note that the FCA does not regulate tax advice.
This document is marketing material for a retail audience and does not constitute advice or recommendations. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amount originally invested.