pissed at paying cgt when I took a risk to invest my money

[pettywitchinlondon]

I've got quite a large tax bill to come as some of my investments have done very well. I don't mind paying tax usually, but I'm a bit pissed at this as I had to take a huge risk with money I've already paid tax on and if I lost it all the government wouldn't bail me out.

[pettywitchinlondon]

Thanks dump,agree its difficult for them to spend money that we all agree on but it could be made better.

For what its worth I wasn't particularly lucky with my investments, many increased over 10% in a few days when the government turned on the printing presses and it was a bit of a no brained buying oil when it fell to 46.

[drspouse]

bustraintram Indeed, so actually a lot of people who have paid tax on their earnings THEN pay tax again on the things they buy. And the proportion of their income paid in tax is more for people who earn less partly for this reason.

As other posters have said YABVVVU. You are only paying tax on your NEW earnings not on the money you invested, which as you say you have already paid tax on.

[TheAnswerIsYes]

If you are paying as much as 28% tax I think you should have got some better tax planning advice before you sold. I have properties with a healthy income and my accountant minimises the tax I pay annually to almost nothing. He will do the same whenever we decide to sell.

[ilovesooty]

Perhaps you should have informed yourself better before you made your investment choices.

I am also single and think you should have known what the deal was. You made a profit. Well done you. Zero sympathy here.

[pettywitchinlondon]

Yes, I'm arguing about the system. You and others are just saying I should try to defraud the system rather than trying to reform it. Misses the point.

[DoJo]

Tax planning is not defrauding the system, it is actually a part of it which is specifically structured to reward those who take risks by offering them concomitant benefits. Do you have an accountant?

[pettywitchinlondon]

Depends on your view on avoiding tax for if its defrauding the system or not.

[DoJo]

I'm not talking about avoiding tax - I'm talking about taking advantage of benefits specifically aimed at people in your position. I'm assuming that you do not have an accountant if you believe that avoidance, fraud and tax planning are one and the same, but if you aren't prepared to entertain the idea that you could be paying less tax without doing anything fraudulent then you can't really complain about the rate you are paying.

[Lookatmyredtrousers]

You can't have a view on whether tax avoidance is fraud or not- it's not. That's all there is too it.

[pettywitchinlondon]

Well I said defrauding the system.

What is tax avoidance one week,could be tax evasion the next.

[maninawomansworld]

Employ a decent IFA. Best money you'll ever spend!

Mine saves me a FORTUNE every year in money that would otherwise go to the government. It's really not rocket science and many will work for a cut of what they make / save you.

[Lookatmyredtrousers]

"What is tax avoidance one week,could be tax evasion the next."

Only if the law changed. Then you'd obviously stop doing it

[PomeralLights]

I hate threads like this with a passion.

There is NO 'double taxation' where the same individual pays tax on the same money. There just isn't, it's a fundamental principle of the system.

Yes company profits are taxed and then so are the dividends when paid but the company and individual are separate.

IHT? You didn't earn the money in the first place.

CGT? It's a profits tax, so the amount taxed is the additional money ON TOP of the money you invested.

Why are rich people (I don't care how 'frugal' you are, money spare to invest = rich) always so bloody ridiculous about how 'unfair' the system is. Sometimes I think there ought to be a 'I moan about how rich I am' tax where people who moan about tax get their bill doubled (not really, obvs).

And don't get me started on how 'unworthy' the things tax money is spent on are, you invested your money rather than giving to charity, I have no interest in looking to you for altruistic decisions on public spending.

[Lookatmyredtrousers]

Great post pomeral

[PtolemysNeedle]

YANBU. I've had to pay CGT on a property just because it's gone up in value. I haven't sold it, so there was no money to pay the tax with, and until the property is sold, there's no profit to tax IMO. Had to get a loan to pay it, it's incredibly unfair.

[PtolemysNeedle]

(I don't care how 'frugal' you are, money spare to invest = rich)

This is a pathetic and inaccurate statement.

[Lookatmyredtrousers]

Why did you have to pay CGT before selling the property? There is no gain so no tax to pay?

[Binkybix]

Because in effect you are then taxed three times on the money (or rather the money is taxed three times) - once when you earn it, then its hit by IHT, then you pay expenditure taxes when you spend it

The other issue with IHT is that you can have the situation say where a parent dies prematurely where there are insufficient liquid assets to enable dependents to stay in the family home

If we're talking about the money being taxed, then all money is taxed multiple times surely, as it's spent, used and changed hands. It's only taxed 3 times if you think of it having the same owner throughout, which is doesn't because the original owner dies.

There are provisions in place to allow dependants to stay in the house in most cases.

[PomeralLights]

PtolemysNeedle if you're in the UK you shouldn't be paying CGT on your main residence.

So...are you paying CGT on an investment property? And calling me pathetic because I say people who can afford to make investments are rich?

You do realise how rich being able to invest in property makes you right? In comparison to the average person on £20k pa?

[pettywitchinlondon]

money spare to invest = rich

What a stupid post.

[maninawomansworld]

I think someone is a touch jealous!

[Lonecatwithkitten]

I would be discussing closing with my accountant/IFA how to manage my CGT liability if I were you.

[pettywitchinlondon]

Funny how on here the amazons and googles of the world are brought in to many threads just to blame but most want to do the same with their own finances.

[Mistigri]

I've got to say that I find it extraordinary that someone who has the assets and the investment ability to make capital gains that significantly exceed the (relatively generous by international standards) allowance, doesn't also have the sense to do a bit of tax planning!

[OTheHugeManatee]

Good luck OP. MN is very pro high taxes so you won't get much joy.

IMO there is a debate to be had about the proper size and reach of the state but somehow I don't think that's likely to happen in a balanced way on here.