Capital Gains

Question 1

Companies

Answer 1

Companies are not liable to capital gains tax

Question 2

Individuals

Answer 2

Gains are taxed at a flat rate of 10% for basic rate tax payers

And 20% for higher rate payers

Question 3

Residential property and carried interest

Answer 3

Taxed at 18% for basic
Taxed at 28% for higher rate

Question 4

Tax free band ?

Answer 4

21/22 and 22/23 the tax free band is £12,300

23/24 it is £6000

Question 5

Computation formula

Answer 5

Disposal value - gross proceeds
Less incidental disposal costs
Less allowable expenditure
= chargeable gains

Question 6

Who is a chargeable person ?

Answer 6

If an individual is UK resident OR ordinarily resident during the year of assessment, then they are chargeable to CGT on worldwide gains accruing in the year. If an individual is non-UK resident then there is no liability on disposals of personal assets.

Question 7

Who is exempt ?

Answer 7

● charities

● pension funds

● local authorities

● diplomatic representatives

Question 8

What is a chargeable asset

Answer 8

Principle private residences (look at next week)

● Some chattels - ‘chattel’ means tangible, moveable property. Wasting chattels, i.e. chattels with an expected life of less than 50 years are exempt, e.g. race horse