I trade in stocks on a small scale, can somebody please explain if/when I will be liable for capital gains tax. Is the tax related to the total amounts sold or just to the profit made from the sales.

Try this site for calculating your capital gains tax - I have used it for calculating my cgt over last 5 years and it really is quite good - it processed about 1500 trades and works out cgt liability etal - and its for free.


http://www.cgtcalculator.com/

Baza

Just used the above site to check my calculations and the only difference is where I've opened a short in one year and closed it in the next. The cgtcalculator treats the gain / loss as arising in the first year (with the opening sale) but surely it must be in in the second year (with the closing buy)?

Can anyone confrim please?

profit or loss, whether long or short is assessed in the financial year the trade is closed, so yes should be in the second year (the calculator must be working on when the sell takes place rather than when the position is closed)

Many thanks Fundamentalist

To claim a loss from previous years (04/05) do you just fill in the CGT pages for that year and send it in?

Also, is it still not possible to complete the CGT section online this year?

With regard to claiming losses from previous years, you have 5 yrs and 10mths from the end of the tax year the loss arose in to claim it. Assuming you didnt fill in CGT page for the previous year then yes id fill this in and calculate the loss from it. Id then include the loss on this years form in the box for "losses brought forward set against this years gains (box F6), youll also need to calculate whether youve used up all your losses or are still carrying any forward to future years (boxes 8.15 to 8.21)

Havent declared any CGT this year so am not sure whether its still unavailable online, though if you are claiming for previously undisclosed losses at the same time then i think youll need to go down the paper route with a short cover letter explaining that youve included the previous year page to declare losses not previously disclosed

Thanks again Fundamentalist

Mr Ripley - if you contact the people who wrote the software - they are usually very good at coming back with answers to your queries and telling you how to manage the problem. I think they have a contact us email address. I had a response within an hour for a query ?

Thanks Bhunt - will do

What if the money you use to trade is between 3 friends,but the trading account is set up in one name only. how would we prove this? How far back can you go with your losing trades?

Losing trades you can claim as losses against gains upto 5yrs and 10mths after the end of the tax yr they occurred in.

As for the 3 friends on one trading account, you really should have a business agreement set up to cover this and profits losses should be accounted for on a business basis rather than just splitting any profits gains between the 3 individuals

Thanks Fundamentalist!

Have been having a discussion on CGT liability and I have a query regarding "notification limit". Can anyone clarify what "total sales proceeds" are, in that if they are under 35,200 you do not have to declare anything. Does it mean proceeds after taking account of total gain minus total losses or is it the total value of all your transactions throughout the year? Would appreciate any comments :-)

It is the value of your transactions - add up everything that is sold in the tax year.

Including the amount you put into the investment so if you buy 100 shares at 10 that investment is also included in the transaction value?
Sorry if I'm being dense but I haven't heard of this either..

No, Stockbunny. As far as I'm aware it is just the value of everything you sell, irrespective of your buy price
eg.in one tax year:
you sell a share at 2000, (you originally bought at 1000)
you also sell a share at 500, (you originally bought at 1000)
your total share sale proceeds for that year is 2500 - the price you bought at (or when it was) is irrelevant in calculating the 'total sale proceeds'. That is to the best of my knowledge anyway.

So the original buying price is not disregarded, as when you sell you get back what you originally invested also in the total sale amount. If you are buying and selling something like RIO it wouldn't take long to techncially have total sales on that limit.

If anyone else knows anything please post cos despite Framptons best efforts I'm still confused, but this is not unusual!

ttt - Little woman are you about???

Frampton is correct. Total sale proceeds are exactly that - the total amount of money you got (after any sales commission) from selling the stock. Yes, you are also right in thinking you don't need many transactions to have total sales more than the declarable limit. It is irrelevant what profit you made, if any, which is subject to a separate limit. You are obliged to declare for CGT if you breach either limit in any tax year.

Exotoxin, can you post what the limit is please.

For the current 2006-2007 tax year the total sales limit is 35,200 and the profit limit is 8,800. Last year it was 34,000 & 8,500.