CGT Implications on buying shares abroad

afterburn

Hi,

Has anyone ever had any experience buying shares in the US and filing for CGT here in ireland on the gains made.

What happens in the following scenario with interest rate differences.

When I transferred money to the us the rate was 1euro-$1

So in the following case I transferred 10,000euro which inturn I bough some shares in us dollars. $10,000 worth.

Now I have sold these shares and the net proceeds on the gain is $5,000 so I now have $15,000.

What I want to do is transfer this money back and file for the CGT on the gain here in ireland as I am except on US tax filing.

The problem when I transfer this back the interest rate has now gone up from 1euro-1$ and is currently trading at 1euro-$1.18 so the $15,000 is now worth 12,300euro

So in theory I originally had 10,000euro I now have 12,300 euro after the transfer. The gain on this is 2,300euro.

Is it correct in saying that I pay the CGT on this 2,300euro at 20% only minus the initial cut off limit of course of 1,200. These shares trading are part of my own investment and are not part of options granted though my current company.

Any help in this regard would be helpful.

Victor

I suspect you might end up being hard done by the revenue - you might have two scenarios - CGT (a gain) and currency speculation (a loss- and taxed differently anyway). However, given that it was presumably a genuine investment, you might get away with balancing one agaisnt the other. You should really talk to an accountant.

Rainyday, where are you?

LoneGunM@n

under the remittance basis [money or monies worth brought back into the state], the charge to tax arises by reference to the date the gain is remitted and not to the date of the disposal!!

when calculating the CGT liability, you may be able to index the original purchase price of the shares.

you are also entitled to an annual exemption of €1,270.00 per annum!!

hope this helps out!!

PF

afterburn

Cheers guys.

This gives me some heads up, I'll try and get in contact with an accountant and the revenue to see exactly how these see this situation.

RainyDay

Hi Victor - I already answered this question when it was posted on Askaboutmoney