Do i have to sell shares to claim a loss?

[viztopia]

I have sold a site and i now have to pay cgt on it. i have some shares which are currently worthless. i was thinking of selling these and offsetting the loss against the gain on the sale of the site. i got on to my broker (wont name them but they are probably the best known brokers in the country) they told me they would give me a letter to say that the shares are worthless and this woule be good enough for my tax return. My accountant has told me i would have to actually sell the shares. Has anyone ever come accross this before?

 

[mercman]

AFAIK, the shares must be sold to evidence a loss. If the company has gone bust you need to be able to display the company's shares are no longer traded to qualify for the loss.

 

[WaterSprite]

If the shares are essentially worthless, you can elect to write them off without actually selling them. You'd be assessed on CGT if you ever did sell them for any money at a later date. It's also up to Revenue whether to accept the write off, I believe.

 

[deadlyduck]

I think your brokers are correct in their advice. Tell your accountant to check s538 of the Taxes Consolidation Act 1997.

You should be able to make a claim for loss relief if you can prove to the satisfaction of the Revenue Commissioners that the shares are of negligible value ie effectively worthless.