Tradefair & Financials
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Hello folks,
i work for a global company and contribute 5% of my salary toward a company share save scheme, which contributes one share free, for every one I buy.
The share price has dropped a fair bit, but has started to recover, between q4 2009 and moving into the new year I expect some steady growth.
When this started around 10 years ago, I always thought of it as a retirement nest egg, and recent event with the economy have awakened me to the realisation that share prices are cyclic and even the biggest companies in the world can be affected by events such as those in the last 18 months.
To this end, I wish to start paying more attention to my fund, and start releasing some of the fund when "the price is right" (the holy grail I know), and when it makes sense for me financially. What I am not clear on is the tax implications of this. Are all share sales liable to capital gains, or are there ways of me not being heavily impacted?
I was thinking about transfering share ownership to a member of my family (retired) but don't know if this is possible. My ideal scenario is to use funds to reduce my Mortgage burden.
Sincerely appreciate any views or advice on this.
Allyp
i work for a global company and contribute 5% of my salary toward a company share save scheme, which contributes one share free, for every one I buy.
The share price has dropped a fair bit, but has started to recover, between q4 2009 and moving into the new year I expect some steady growth.
When this started around 10 years ago, I always thought of it as a retirement nest egg, and recent event with the economy have awakened me to the realisation that share prices are cyclic and even the biggest companies in the world can be affected by events such as those in the last 18 months.
To this end, I wish to start paying more attention to my fund, and start releasing some of the fund when "the price is right" (the holy grail I know), and when it makes sense for me financially. What I am not clear on is the tax implications of this. Are all share sales liable to capital gains, or are there ways of me not being heavily impacted?
I was thinking about transfering share ownership to a member of my family (retired) but don't know if this is possible. My ideal scenario is to use funds to reduce my Mortgage burden.
Sincerely appreciate any views or advice on this.
Allyp
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are you married?
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http://www.hmrc.gov.uk/helpsheets/hs287.pdf
that should do the trick you need to speak to your HR to find out whether your share scheme is approved by the HMRC for special CGT treatment or now |
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yes, married and the mrs works for the same mob. Both contributing.
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PS Thanks a lot for the link!!
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if its for a sizeable contribution it may be worthtaking some financial advice
i am personally not a fan of keeping hold of these company share save schemes as you are putting all your eggs in one basket and most of your wealth (particularly in your case) will be linked to the performance of your company anyway through bonuses/salaries Imo you are better off getting some decent advice and making sure that your 5% goes towards something that is aligned with both of your goals |
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Yeh, I believe you are right, i need to get some decent advice.
The amounts are substantial to us, and with some (expected) reasonable growth, it will get bigger. I went into this schem thinking free money....5% a year straight off the salary...doubling up..making 10%...and not missing it....hence the belief in the reitrement next egg. I am now realising it's not quite as simple as that. |
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It is classed as income and taxable if sold within 5 years, after 5 yrs then tax free i believe.
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Usual capital gains rules will be applicable and unless chance of your company going busto then i think you can think of it as free money.
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Should it be capital gains liable then use the financial years to ensure you use you tax free allowance up each year - e.g. sell March 31st a batch then April etc.
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