Income tax optimisation

[yyy]

Is there any way to sell and buy back the same stock at no cost and therefore realise the capital gain/loss in this tax year. I want to keep the position. I've owned the stock for more than 3yrs. Will this be considered as trading if you go straight back into an identical position, even if you hold it for another 3yrs?

[THRESHOLD]

In the UK this is now disallowed and is known as "bed and breakfasting." It was especially prevalent in the derivatives market. If you trade in the underlying it will be an income loss and not be available for set-off agains CGT. In SA, short term "short" positions have been allowed as "capital" items where they were proven to be motivated by the need to hedge a long term ("capital") portfolio. This would tend to indicate that this is the preferred method of protecting a portfolio. Selling and re-entering is, at the end of the day, short term trading on the short side. GET proper advice form your tax advisor. Granted, they tend to know very little; so maybe you should go and see a tax attorney with one of the bigger law firms.

[yyy]

thanks, will get further advice.

[HC]

What if one sells a share and immediately buys another in the same sector (e.g sell Anglo and buy BHP) surely this could not be regarded as Bed and Breakfasting?

[THRESHOLD]

Well - one must assume you were in the first share because you wanted to be... so...