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Say you have the following list of trades:

  • Buy 100 XYZ at £50 a share on March 1st
  • Buy 100 XYZ at £51 a share on March 1st
  • Sell 200 XYZ at £60 a share on March 20th

This would result in a net profit of £1,900, disregarding of whether you average the first two trades or not.

Now, according to the official guides:

All shares of the same class in the same company disposed of by the same person on the same day and in the same capacity are also treated as though they were disposed of by a single transaction, TCGA92/S105 (1)(a).

It seems to me that I should not report the first two trades as two distinct trades at all, should I? They should be replaced with:

  • Buy 200 XYZ at £50.50

I know that in this particular scenario the net gain would be the same, as there are no disposals of the same asset on the same day, but it'd be good to know the correct approach.

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  • I think that your conclusion is correct but that you cited the wrong paragraph from your link because the shares in question are the two purchases made on March 1st. It should have been All shares of the same class in the same company ACQUIRED by the same person on the same day and in the same capacity are treated as though they were acquired by a single transaction, TCGA92/S105 (1)(a).
    – Bob Baerker
    Jan 19, 2021 at 12:47

1 Answer 1

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"bed and breakfasting" rules apply since you are selling within 30 days of acquisition.

See this HMRC publication.

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  • 2
    That only applies if you buy within the 30 days after selling, not the other way around
    – GS - Apologise to Monica ♦
    May 24, 2020 at 10:48

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