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AF1 - Tax & Trusts > CGT > Flashcards

Flashcards in CGT Deck (12):
1

CGT exempt assets

Gilts, Main Residence, ISA’s, Private motor vehicles, chattels with less than £6k, foreign exchange, gambling winnings, VCT’s & EIS’s and NS&I

2

Chattels Relief

Sale price - allowance (£6k) x 5/3

3

CGT Losses

Not all of the losses need to be used in full. A loss incurred in the same year must be offset against current year gains. However losses must be used within 4 years of the end of the tax year relate to

4

Share Pooling

Share identification
Sold 5000 shares @ £5 on 1/9/17
But bought
4000 @ £4.50 on 13/9/2017
3000 @ £3 on 1/3/14
3000 @ £2 on 1/3/12
All purchases in the following 30 days must be reviewed
Share pool = 6000 shares costing £15k which = £2.50 per share.
This is used as the acquisition cost

5

Holdover Relief

Can be used to defer the capital gain on the transfer. No CGT is payable at the time. The gain will be taxable upon future sale or if in a trust absolutely entitlement

6

EIS

A chargeable gain can be deferred by investing in an EIS. This would defer any liability. However, the reinvestment must take place within a period starting 1 year before and ending 3 years after the share disposal. The gain comes back into charge when the EIS shares are disposed of unless another EIS is done.

7

Disposal of shares in a bare trust

Tax is charged on the beneficiary and their CGT allowance is used

8

Letting relief

Is the lower of the principal residence relief that applies to be property or chargeable gain or £40k

9

Apportionment

Final 18 months of property that was main residence at 1 point is exempt as part of the apportionment calculation

10

Calculating the gain on inherited property

The probate value is used as the acquisition cost when calculating the gain

11

What’s the annual exempt amount for CGT

£11,700

12

What’s the annual exempt amount for a Trust with a capital gain?

£5,850