Capital gains on free shares

A quick question, I am really wondering how this would work… When you get free shares on T212,

  1. are they counting towards your capital gains allowance if they are in the general invest account?
  2. If not, then how would one go about calculating the value to declare in the self assessment? Is it only if you “dispose” of these then you add them into your self assessment?

For reference the capital gains tax allowance is £12,300 so unless you’re raking in the free shares, I expect you wouldn’t have to declare if it is in category 1.

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Only around 1% of the UK population pay capital gains tax, if you are making a large profit of 12.3k+ outside your ISA and need to declare things to the tax man then a £10 share isn’t going to change that much.

You pay tax when you dispose of it so might make say £10 profit if you are lucky if you double up and sell it which means about £1-£2 extra capital gains tax. (10-20% capital gain tax on the profit depending on income)


Thanks - so if I’m reading this correctly the free shares count towards my capital gains allowance and are liable for tax only if I exceed the allowance (extremely unlikely as the amount is so small) and once disposed (aka sold)?

That’s kind of what I thought - just paranoid this year as I need to fill the self assessment to account for side hustle income…

Yes but remember it’s 12.3k profit allowance not value of shares disposed. So that free share value doesn’t “go toward the allowance” it’s the “difference between the buy and sell price of the share” that goes toward the allowance.

Eg: you could sell £100k worth of shares in the tax year and only make £10k profit on that (counting up your gains AND losses) and not have to declare any gains.

if the transaction is £100k then they would need to declare it even if its below the allowance. because it’s more than 4x the allowance and when making such gains the person would usually already be registered for self-assessment.

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Thanks - the 100k is when that is your revenue or earnings in a year.

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Agree although as it’s a free share anything you sell will be gains

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what the shares were worth. so if you sell shares worth £52,000 and only make a profit of £8,000 then you would need to declare because the total sales value is more than 4x your allowance. but if your shares were worth £42,000 and a profit of £8,000 then you don’t have to declare.

this is on the basis you fill out your own self-assessment forms, but if you are moving that much money about each year I don’t see why you wouldn’t be doing so already.