Readers' forum: Share swaps

My husband and wife clients have built up various shareholdings in their own names over the years and many of the holdings have accumulated gains. The clients would like to retain the holdings but mitigate the charge on an eventual sale by taking advantage of their annual exemptions. I have suggested that they could ‘bed and spouse’ shares to each other.

The clients are happy with that plan but for reasons best known to themselves they would like to retain the shares in their own names. On the basis that the shares acquired by the spouse will have a higher base cost after the sale and repurchases I wondered whether there is anything to stop them each then simply transferring the shares back to the other. Am I overlooking anything?

I look forward to replies.

Query 19 362 – Shareholder.

Reply by Goston

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