Bed & Breakfast arrangement availability...

[rob oyle]

Hi all,

This is a query that could also have been put in the Investments forum too... I just wanted to know if it is possible to arrange a B&B on shares (a sell and repurchase of shares in order to utilise the E1,270 annual allowance for CGT) for a reasonable fee?

My shares are held by Davy Select but they say they do not provide B&B facilities. Last year I did an online trade to sell Ryanair shares and then repurchase them but such were the fees/stamp duty involved (E318) that it almost effectively negated the CGT tax savings (E381).

Furthermore, if a bank/broker offered the service would they require physical evidence of the shareholding? I don't know why this should be necessary (if you're not a shareholder then you'd be paying them a fee for nothing!) but I could understand some hesitancy from a staff member not familiar with the arrangement.

 

[rob oyle]

Would expect/hope that others have done this recently and it would be of wider interest to other readers here too?

Incidentally, I'd been working off a CGT rate of 30% for my earlier example but now I realise that my self-exercised B&B last year cost me money (fees of E318 compared to a potential future tax saving of E317!).

 

[Jim2007]

Well as far as I remember there is a 4 week rule which would make your B&B amount to tax evasion, otherwise I would have expected that there would be plenty of options available to do this....

But it is a long time ago since I paid Irish taxes and investing is a tax exempt activity over here

 

[rob oyle]

Thanks Jim2007, but I think the 4 week rule applies in the case where the shares have only been recently been bought. Don't worry, this practice is all above board!

Just following up here, it would seem that no one knows about B&B availability, particularly in the case where share certs aren't physically available?