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Company Shares and CGT liability

(7 Posts)
InMySpareTime Thu 17-Nov-16 15:37:31

DH's company is being bought out, the buyer is purchasing all shares at a fixed price as part of the buyout in summer 2017.
He has a load of RSUs that will vest at the date of buyout, and has been buying shares steadily from his paychecks over several years.
Is there a way to manage CGT liability for this, as all told it's about $80k (UK value depends on exchange rate next summer)?
I read a bit on "Employee Shareholders" on the HMRC website, don't know quite what that is or if it applies in this case.
DH's boss thinks there should be a way to use my CGT allowance and DH's over this tax year and next to minimise tax liability, but I figured you clever folks might know what to do in this situation.

InMySpareTime Fri 18-Nov-16 17:39:35

Anyone?

Ta1kinpeece Fri 18-Nov-16 18:22:56

Worth paying for an accountant to do his tax return and start looking at it right now

kath6144 Fri 18-Nov-16 21:54:10

Hi, I had my company shares compulsory bought this year, as my employer was being bought out. Was a privately owned US company, my shares bought 15ish years ago, price risen steadily over years so my gain was over 70K.

I had been advised by colleagues a couple of years ago to put the shares in mine and DH joint names, which I did, meaning we can now offset both our CGT allowances against the gain. However, you do need to put the shares into your joint names prior to the sale (if his company allows it), so that the gain is classed as joint and you can use both allowances. I did it as I would have had to sell my shares back to the company on retirement, however I am now very glad that I didnt wait a year or 2!!

I cannot see how he can use both this year allowance as well as nexts? As far as HMRC are concerned, all the gain will be within the tax year that the shares are compulsory purchased, unless he can sell some of his shares within the current tax year (our company banned any share sales once the takeover was made known but we only had a few weeks notice).

The other way to lower liability, is to sell any personal shares he has in other companies, that may have lost value since he bought them. He can then offset this loss against the gain from his company shares.

Hope this helps a little.

I have just come to the conclusion that the gain we got was a very nice sum and we will still have plenty of it left after paying CGT so just need to suck it up. It's a pity, as colleagues that had retired in recent years had sold shares off annually to ensure no CGT, but then they didnt get the uplifted share price that the rest of us got from the buyout.

InMySpareTime Sat 19-Nov-16 08:05:18

Thanks, he only has company shares, so no losses to offset, but will look into the joint name thing.

SandyDays Sat 19-Nov-16 08:22:06

I'm a trainee tax accountant so don't feel adequately qualified to advise you, but I would say that this is something our accountants deal with on a daily basis and for a few hundred pounds a good accountant can save you thousands. Most offer a free initial meeting and will charge maybe £250-300 to cover the CGT and your annual return.

SandyDays Sat 19-Nov-16 08:23:57

You may also be eligible for entrepreneur relief depending on the circumstances

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