Disposal of shares - valuation
In this lesson, you'll learn how to value shares when they're disposed of for capital gains tax purposes. You'll discover the key valuation rules for different disposal scenarios: sales at arm's length (using actual proceeds), gifts and connected person transfers (using market value), and quoted shares (using the
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In this lesson
- 0:00 Shares and securities lesson overview
- 0:37 Valuing shares for disposal purposes
- 1:31 Market value rules for quoted shares
About this lesson
mid-price formula from stock exchange listings). Understanding these rules is essential for the Taxation paper, as share disposal questions frequently appear in both objective tests and case studies, and accurate valuation directly affects the chargeable gain calculation. The lesson covers the foundation you need before tackling more complex share matching rules. You'll see how to apply the mid-price method for PLC shares—adding the bid and offer prices quoted on the stock exchange and dividing by two—and understand why different valuation approaches apply depending on whether shares are sold commercially, gifted, or transferred to family members. This distinction matters because it prevents tax avoidance through gifting while ensuring commercial transactions are taxed on actual consideration received.
Duration: 2m
Transcript
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