I need some help with CGT on profits from stocks

[contemplatingfarmer]

So early January till February I got into investing and I ended up being about 2 k in a loss and from what I’ve heard if ur in a loss from a trade u can minus that from the tax u owe . So I stopped trading until about late September and now I managed to make about 16 k . Now my question is if my tax for the 16 k is give it take 5 k does that mean I only have to pay 3 k considering the loss I had at the start of the year.

My next question is what happens if for example I’m off like 100€ for the tax I paid ?

 

[artsynova]

@contemplatingfarmer If this year you lost 5k and made 16k, you will have to pay tax on 11k-1270(personal allowance) . So you'll have to pay 33% of 9730. At least that's my understanding of it.

There are handy videos on YouTube if you search "CGT Ireland" (or something along those lines). Also worth checking citizensinformation.ie and revenue.ie

 

[resjudicata]

@artsynova They had a 2k loss, but yep you're right.

 

[christianman02]

@contemplatingfarmer

IF, and i say IF, u have some badly performing stocks, u could sell them at a loss to offset even more against your 16K gains and hence reduce your tax bill even more. But who knows thos bad stocks might come good eventually.

 

[resjudicata]

@contemplatingfarmer It's profit minus loss minus tax free allowance times 33 percent.

So for you: 16k profit - 2k loss is 14k. 14k - 1270 allowance is roughly 12.7k. 12.7k multiplied by .33 is abut over 4.2k you owe. Which has to be paid by the 15th of November

As for your last question you can be fined. but it's usually a small amount, maybe doubling what you were off by. but sometimes they will just let you off if they believe it was a genuine mistake.

 

[christianman02]

@contemplatingfarmer and make sure u have a grasp of the rules when it comes to selling shares in ireland.

I discussed LIFO. FIFO and the four week rule in another thread in this subreddit.

Another thing to consider is the frequency and nature of your trading. Could your activity be classified as a trade itself? Is it your main or additional income? it could be subject to income tax, prsi and USC rather that CGT. And the info from Revenue can be vague.

 

[stripe]

@contemplatingfarmer Noob question here, but do you have to pay the tax if you haven’t cashed out? I don’t have much invested - €1k in meme stocks and €1k in crypto. I’m down around €100 after investing early start of the year, but say if I was up, would I have to pay tax on that if I hadn’t sold the stock?

 

[njehia]

@stripe No. The gain or loss is only triggered (realised) when you sell or transfer the asset.

 

[stripe]

@njehia Amazing, thanks so much for the response