The method for valuing shares (including securities and strips) for capital gains tax (CGT) and income tax has changed. The Regulations implementing this apply from 6 April 2015 but do not apply to inheritance tax (IHT).

The value now used is the figure half of the way between the lowest and highest closing prices of the day. This means that there is a discrepancy in valuation methods for CGT and IHT purposes. The IHT value is still calculated under the ‘quarter up’ rule price at the date of the chargeable event.

For death estates, section 274 Taxation of Chargeable Gains Act 1992 determines that the IHT value should also be used as the CGT acquisition cost. Therefore for shares passing on death the valuations are still aligned.