Stocktrade

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BED & ISA

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What are the potential benefits of a BED & ISA Transaction?

There can be significant tax benefits which are as follows:

  1. Disposing of a shareholding to create a capital gain thus utilising your annual CGT allowance (£10,100 tax year 2010/2011).
  2. Disposing of a shareholding to create a capital loss which can then be offset against other gains you have made in this tax year to remain within the annual allowance as stated above.
  3. Disposing of a shareholding to create a capital loss which could possibly be carried forward and offset against any future gains. This will depend on your personal tax position.
  4. The opportunity to simultaneously buy the same shares back in the ISA where any anticipated future capital growth is free of tax.
  5. There will be no further UK personal Income Tax liability on the shares held in the ISA. Higher rate tax payers do not need to make any additional returns to HM Revenue and Customs.
  6. A £1 Panel on take-over and mergers (PTM) levy is charged on all bargains where the consideration is over £10,000. This is to generate income for the PTM, which promotes good behaviour in managing takeovers and mergers.

We would recommend that if you have any doubt about the suitability of such a transaction that you speak to a qualified Financial Adviser.

Any tax relief is subject to personal circumstances and current legislation which is subject to change.