CGT on shares following redundancy

[ConfusedEyes]

Hi there,

I’m a newbie so please be gentle!

I was made redundant last month and have decided to cash in the shares I bought as part of an employee incentive scheme. I am currently still unemployed and don’t foresee that changing for a few months due to personal circumstances. Will I have to pay CGT on the money I get from the shares? And if so, is this something I’ll need to initiate myself or I will I be contacted by the relevant party?

Many thanks in advance for your help.

[bd6759]

You will have to pay CT if you sell them for more than you paid for them.

You need to initiate this by telling HMRC. They will send you tax return after the end of tax year, and you include the gain in the CGT pages of the tax return.

[ConfusedEyes]

You will have to pay CT if you sell them for more than you paid for them.

You need to initiate this by telling HMRC. They will send you tax return after the end of tax year, and you include the gain in the CGT pages of the tax return.

Thank you bd6759. I’m hoping the documents the share people send me will make it obvious what I paid for the shares and what they sold for. All I really knew about it until this point was that I agreed for a certain sum to be taken from my pay each month and invested into shares. The company I worked for would match my contributions up to a certain amount, so that confuses things somewhat. It probably sounds silly but I deliberately kept myself in the dark about the shares and how much they were worth as I didn’t want to be tempted to sell them until I really had to. And now I’m in that position.

[someone]

I recently asked a related question which you might be able to find.

The good news, the money the company contributed will have been taxed as income - so you include that in the calculation of the price paid.

You then pay CGT on the difference between the price paid and the price sold.

If the gains are less than 11K then no tax to pay.

One thing to watch out for, did you get a redundancy package? That might push you into the higher tax bracket this year (some parts of the package can be tax free but others aren't - for example payments in liu of notice count as taxable income). If it does, and you expect to be a basic rate taxpayer next year, then it might be worth waiting until April. OTOH, if your employer is making people redundant then maybe you should sell now!