CGT Liability on Windfall Shares

[maidstoneblue]

I received 200 Friends Provident Windfall shares in July 2001. I also purchased 467 at an averaged price of £2.1375. A year later I received 23 bonus shares (1 for 20) on the 1st anniversary for holding for 1 year.

I am thinking of selling the shares and investing in my SIPP. However I have used my CGT allownace up on selling a rented house and some other shares.

With a share price of around £1.75 I am showing a loss on the 467 I purchased but dont know how to calculate any gain or loss on the 200 windfall or 23 bonus shares ?? I presume I will also be able to claim some taper relief if I have a Gain ?

I have spoken to FP who couldn't help can anyone please advise.

Rgds

[al_eebee]

The free shares have no base cost. The bonus shared are deemed acquired at 137.825pps

So in total you have 690 shares with a total base cost of £1,029.91.

On the share price of £1.75 there is an overall proceeds of £1,207.50 and a gain of £177

Before 5/4/2008 you need to look at two tranches

1) the original holding of 667 with costs of £998 and a net gain of £169 on which taper of 20% is due reducing the gain to £135

2) the bonus shares of 23 with deemed costs of £32 and net gain £8 on which 15% taper is due leaving a net gain of £7

Total chargeable gain £142 taxable at your highest rate.

After 5/4/2008 there is no taper so you would have a total gain of £177 taxable @ 18% on a sale price on £.75/share

[maidstoneblue]

Thanks alot. I thought that the free shares would be nil value but wasn't sure about the bonus shares.

If i was to sell the 467 say or 490 and hold the free 200 would it be deemed i am holding the original 200 or would i fall foul of 1st in 1st out rules or is last in 1st etc.

Rgds

[al_eebee]

I believe that the free shares and original purchased shares were probably acquired at the same time effectively so you will have an averaged pool of those and the bonus shares separately up to 5/4/08. Thereafter it will be one single pool.