Husband’s Bank Shares & Stockbroker Account: Should You Hold On?
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When inheriting shares, the tax implications and investment decisions can be complex. Understanding how your husband’s past losses affect your current position and the potential tax liabilities on future gains is crucial. This article delves into the specifics of inherited shares, capital gains tax, and provides guidance on making informed investment choices.
A key point to grasp when inheriting shares is that investment gains or losses are personal to the shareholder. this means your husband’s past losses are irrelevant to your tax situation. When you inherited the shares, thier base value for tax purposes was established at their market worth on the date of inheritance.
Assuming you inherited these shares sometime after late 2010, you are likely in profit on both of them currently, even if the value hasn’t reached the levels seen before the financial crash. If you decide to sell these shares and your profit exceeds the annual tax-free allowance of €1,270,you will be liable for Capital Gains Tax (CGT) at the current rate of 33% on the gains made.
While this article cannot offer specific financial advice or share analysis,it’s certainly worth noting that generally,analysts see some upside potential for both of the banks in question. This outlook is supported by the state’s exit from their bailout investments and recent interest rate cuts by the European Central Bank, which have positively impacted bank profits.
Though, the more significant consideration is your personal comfort level with investing in individual stocks. Even if you are cozy, it is highly advisable to consider proper diversification. This is a topic best discussed with a qualified financial advisor, such as those at Goodbody, before making any decisions about closing your stockbroker account.
It is unlikely that the lenders will offer any compensation to shareholders who experienced significant losses during the crash, despite their current profitability. While banks may express regret, the nature of stock market investment inherently carries risk. As the article states, “when things go wrong, shareholders will find themselves at the bottom of the pecking order when it comes to people being taken care of.”
Historically, investing in Ireland’s banks was considered a very safe option, akin to government bonds, with dividends providing an added bonus. The crash served as a stark reminder that such assumptions cannot be taken for granted.Investors must take responsibility for their own risk assessment.
Furthermore, any payments received as a widow’s pension from AIB are part of the terms and conditions of your husband’s occupational pension scheme, not a gesture of goodwill from the bank.
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For personalized financial advice, it is indeed recommended to consult with a qualified financial advisor. Queries can be sent to Dominic Coyle, Q&A, The Irish Times, 24-28 tara Street, Dublin 2, or via email to dominic.coyle@irishtimes.com with a contact phone number.*