UK Budget 2016, Shift capital gains tax to next year

JSMITH07611

Member
90 0
the budget yesterday and it seems that capital gains are going to 10% and 20% instead of the current 18 and 28. I havn't studied the budget thoroughly but it seems that these are the rates besides for selling property.

therefore if one has profits this year it would be worthwhile to try and make a loss this year and a profit next year. for example if someone made 10k profit in the 28% band this year. it would be worthwhile to try and loose that money this year and gain it back next year.

so as i am not an accountant i thought of two possible ideas, but i am sure that others probably have more in depth ideas.

1 idea was to do a hedge trade on lets say the ftse future or dax (to avoid overnight costs) so buy 10 lot ftse and sell 10 lot ftse. then wait until 5 april. say the ftse moved by 100 points up. so close the loosing trade and immediately rehedge it.so you will have realised the loss this year of £1000 and next year would close the new hedge at a gain of 1000. the costs would be 3 spreads of around 1 pip so that is £10 per point x 3 is £30 but would save you £80 on tax (£1000x0.28-0.2). the more the ftse moves the better.

one could even avoid the spread of the third trad by doing a close by hedge on the mt4 platform

2 idea was to buy a vanilla option. so lets say the gbpusd is 1.44. buy an option to buy at 1.2. and hedge it by selling gbp/usd therefore there is very low risk, nearly impossible. but when you buy an option you realise the cost straight away which is capital gains loss and later when you close it you realise the gain which you could do next year.

interested in hearing your thoughts as there are only two weeks left

regards
 

remme001

Member
69 2
Or just spread bet and not not bother with all that sillyness to begin with. It's all about ISA's, SIPPs and Spread betting. Use these three and you won't be paying much tax at all. I'm guessing your situation might be a little different though as it looks like you are from the US.
 
 
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