Enter Your E-mail

HM Revenue & Customs has now agreed that joint investors can benefit from favourable tax reliefs for subscriber shares.

Generally, when an individual sells shares for less than their acquisition cost, then he or she will make a capital loss. Capital losses can be set against other capital gains but people may not make further disposals for several years, and it might be some considerable time before those losses can be utilised.

There is a special provision for qualifying shares acquired by subscription - 'subscriber shares' - which allows that the losses may be set against income instead of gains, which can be a significant advantage. ('Qualifying' shares are bascially those in unquoted trading companies).

In the past, joint subscriptions - such as where a husband and wife provided joint funds to subscribe for a shareholding - were NOT eligible for this special relief.

However, HM Revenue & Customs has recently issued a briefing note which confirms that they will now accept that joint subscriptions ARE eligible for Income Tax loss relief. Such claims will now be accepted under the normal Self Assessment rules for 2008/09 and later years. (The time limit for 2008/09 being 31 January 2011 in most cases).

Further information can be found at Share Loss Relief - Relief for Subscriptions by Joint Owners or Nominees: ITA 2007 ss 131-151 (Formerly ICTA 1988 ss 574 - 576L)