I was landed with a capital gains tax bill last month in relation to First Active shares I held before the takeover by Royal Bank of Scotland. I had intended to sell some Vodafone shares I own as a result of the Eircom flotation to offset my liability on First Active.

First Active

However, as it was October, it was too late to limit my tax bill on October 31st. If I now sell these shares before the end of the year, how do I go about reclaiming the money I am owed?

Mr M.C., Dublin

Just when you thought you had heard the last of the First Active saga, along comes the September 30th cut-off point to confuse matters. For people who failed to plan ahead in relation to their capital gains tax liability, there was the unpalatable prospect of having to pay tax on the First Active gains - even though they hold other shares that are currently worth less than they paid for them.

This is particularly true for former Eircom shareholders who still hold Vodafone shares as a result of the company's break-up and are nursing paper losses as a result.

The new capital gains tax regime instituted a September 30th cut-off point in assessing such gains. First Active shareholders looking to reduce their tax bills would have had to sell loss-making shares before that date.

Unfortunately, many let the tax issue slip their minds until reminder letters arrived from the Revenue. By that stage, October had arrived and they were stuck having to pay a substantial tax bill on the capital gains incurred in the First Active deal.

Assuming people sold their loss-making shares in October, or indeed any time between now and the end of the year, they are likely to be in the position where the Revenue Commissioners owe them a rebate on the capital gains tax already paid.

To get this money, you will have to file a tax return as soon as practicable after the year-end. You do not have to wait until the settlement date for fourth-quarter capital gains, which is January 31st.

The return will need to show that you have overpaid the Revenue as a result of an offsetting loss on the share sale between October 1st and December 31st. Revenue is not likely to send you a tax return form at the end of the calendar year.

They will generally wait until closer to the next income tax return deadline of October 31st next year but you can get a return form from any tax office.

Once you have filed the return, it will be processed and a rebate issued as warranted. However, you will not receive any interest on the money paid to the Revenue in respect of your gains in the first three-quarters of the year - notwithstanding that the tax authorities have use of your money for three months or more.

Capital gains

Some years ago, I bought a holiday cottage in the country. I intend to sell my main residence in the city and move permanently to the cottage. I understand that I will not be liable to CGT on the proceeds of the sale of my main residence. However if, at some future date, I were to sell the cottage (which would then be my main residence), would I be liable to CGT?

Ms E.H., e-mail

As you note, you would not be liable to capital gains on the sale of your current home, as it is your principal private residence. Equally, once you sell it and move to what is now your holiday home, that will become your principal private residence and therefore will not be liable to capital gains tax should you subsequently sell it.

However, that only applies to the period during which it is your principal private residence. You will still be liable to pay capital gains tax on a portion of any profit on the property to reflect the period during which it was a second home for you.

For instance, if you bought the cottage five years ago and move into it permanently now only to sell it in five years time, you would be liable to capital gains tax on half of any ultimate gain as it was not your principal private residence for half the period of ownership.

Equitable Life

As you are undoubtedly aware, the Equitable Insurance Society has been in trouble since the UK House of Lords decision of July 2000.

I hold a with-profits bond from Equitable Life for which I invested £5,000 in July 2000.

On reading through the policy, I find that the minimum amount guaranteed at maturity in July 2005 is the original investment.

In a report recently received from Equitable Life on the "Interim Accounts for the Half-Year ended 30th June 2004", it is stated that a group of 873 individuals has started proceedings against the society in respect of their with-profit policies.

I would be grateful for information in regard to where this group may be contacted and also for your views on giving them my support having regard to the fact that I am a with-profits policyholder.

Mr W.D., Dublin

Ah, Equitable Life, the fiasco that refuses to fade into history. The bit of your story that really intrigues me is the dates. You took out your policy with Equitable Life in July 2000, the same month that the damning House of Lords ruling was handed down. Now I accept that, ahead of the ruling, the general view was the Equitable could not possibly be held to account on the guarantees it offered in earlier years. However, that view was not unanimous and, at the very least, Equitable Life carried a significant health warning at that time.

I am also surprised that you are only now - four years into this investment and after whole forests have been levelled to retell the ongoing woes of Equitable Life - checking the small print to see what your worst-case scenario might be. The fact that the original investment - and only that investment, with no allowance for inflation even - is guaranteed, is no surprise to me.

As far as pursuing any claim for compensation is concerned, my strong advice to you is not to bother. Your investment, while substantial to you, is certainly small when compared to the costs of protracted legal battles.

However, if you choose to proceed, you will find no shortage of interest groups looking for your support.

There are numerous different groups attempting to winkle compensation out of Equitable Life for mis-selling or other broken promises. The one to which you refer is ELTA or Equitable Life Trapped Annuitants, www.elta.org.uk, which represents those people who hold with-profits annuities with the society.

It does not sound as though it fits your predicament. However, it is part of E7, an umbrella group of groups representing those affected by Equitable Life. Its spokesman, as far as I can determine, is Mr Paul Braithwaite, whose phone number is 0044 207 2675938 or on mobile at 0044 7973 537480

There is also a website www.equitablelifemembers.org.uk for all those involved in the Equitable Life debacle. Other websites include www.emag.org.uk.

Please send your queries to Dominic Coyle, Q&A, The Irish Times, D'Olier Street, Dublin 2 or e-mail to dcoyle@irish-times.ie. This column is a reader service and is not intended to replace professional advice. Due to the volume of mail, there may be a delay in answering queries. All suitable queries will be answered through the columns of the newspaper. No personal correspondence will be entered into.