Capital Gains Tax Relief Flashcards
(14 cards)
what is the formula for gains?
total gain * (shares / total consideration)
for business asset disposal relief who can be eligible for that?
individuals incl. sole traders and partners
for rollover relief who can be eligible for that?
individuals or companies
the business asset disposal relief applies to?
disposal of a business or business assets
the rollover relief applies to?
disposal of a business asset where the proceeds are reinvested in another qualifying business asset
what is the minimum ownership period for business asset disposal relief?
The asset or business must have been owned for a least 2 years prior to the disposal
what is the lifetime limit for business asset disposal relief?
There’s a £ 1 million lifetime limit of gains eligible for BADR
what are the qualifying assets for rollover relief?
- land and buildings (used in trade)
- fixed plant and machinery
- goodwill
when must the replacement asset be purchased?
it must be purchased within 1 year before or 3 years after the disposal of the old asset
what is gift relief?
It allows capital gain on the gift of certain business assets to be deferred; instead of the giver paying capital gains tax at the time of the gift, the recipient takes on the gain and pays CGT when they sell later
What are the 4 different types of capital gains tax relief?
- business asset disposal relief
- gift relief
- rollover relief
- incorporation relief
What conditions have to met if you want to qualify for incorporation relief?
- you have to transfer a business
- you have to have transfer the whole business as a going concern
- all assets are transferred to the company
- you only receive shares in exchange
what gets immediately chargeable?
any cash or any other value
what is immediately chargeable also known as?
partial relief
