Tax and your investments

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23. Calculating your CGT liability

A quick re-cap of where we've got to so far:

• Capital gains liability arises on the disposal of shares at a profit
• The calculation of your taxable gain is: Disposal Proceeds - Base Cost
• For assets bought before 6th April 1998, you can increase the base cost using the indexation allowance.
• For assets disposed of after 5th April 1998, you may be able to reduce the taxable gain using taper relief.
• In each tax year your total liability will be the aggregate of all your capital gains less capital losses.

When you have calculated the taxable gain for all the assets disposed of during the year, you can then take advantage of your annual CGT exemption. This is explained on the next page.

1. Keeping it legal 2. How HMRC treats your investment income 3. Keeping records 4. The basis of dividend income 5. Dividend income 6. Interest income 7. Interest on Treasury Stock 8. Capital gains tax basics 9. Base cost 10. Indexation 11. Taper relief 12. Indexation and taper relief - together! 13. Date of acquisition 14. Disposal proceeds 15. Disposal of a holding with a history 16. Takeovers 17. Bonus/scrip issues 18. Share splits 19. Buybacks 20. Rights issues 21. Share options 22. Beneficiaries and minors 23. Calculating your CGT liability 24. Using your annual CGT exemption 25. Transfers between spouses 26. ISAs 27. Delaying capital gains 28. Other tips to reduce CGT liability 29. Conclusion