CGT losses are normally available for offset against gains of the year in which the loss arises, or in subsequent years. However, in some cases, a loss can be offset against income, notably, a loss on subscribed for shares in certain trading companies.   A loss will arise when there is an actual disposal or where there is deemed to be a disposal, for example, on a claim for the shares having become of negligible value. A negligible value claim does not have to be made as soon as the shares are in fact of negligible value and it is possible to defer making the claim (and therefore crystallising the loss) until a year when the loss can be more profitably used. Therefore, if you own any shares which may have a negligible value, you may want to consider deferring making the claim until after 5 April 2010 in order to set the loss against income taxed at 50% as opposed to cashing in the loss now for 40%.   One important point to remember is that in order to make a negligible value claim, you have to still own the asset and so it may be worth deferring any intended strike off of a company until after you have made a negligible value claim i.e. where the company is your personal company as opposed to you simply holding shares listed on the stock exchange. 

Posted on 18 Nov 2009