Flashcards in CGT & IHT Rates and allowances Deck (8)
What happens to an asset you dispose of to your partner or spouse?
You do not pay tax on that disposal unless
you separated and did not live together at all in that tax year
you gave them goods for their business to sell on
What happens to a disposal of an asset to a charity?
No capital gains tax has to be paid unless you sell it to a charity for more than you acquired the asset for
What is the capital gains tax free allowance
Gains under £12,300 or £6,150 for trusts
What are some reliefs companies can receive for CGT
Entrepreneurs’ Relief (sole traders or business partners)
Rollover Relief (buy a new asset 3 years after disposal of old)
Hold-Over Relief (you used the business asset for trading as a sole trader)
Incorporation Relief (transfer all your business assets in exchange for shares in a company)
What is private residence relief
Relief given for the disposal of a residential estate used as the sole residence of owners. The permitted area is exempt from CGT and encocmpasses 0.5 hectares of land and anything else deemed of appurtenance
What relief is there for Gifts received on IHT
People you give gifts to will be charged Inheritance Tax if you give away more than £325,000 in the 7 years before your death.
You can give away £3,000 worth of gifts each tax year (6 April to 5 April) without this being added to the value of your estate
Gifts made from 3-7 years up to death have a sliding scale of tax
What reliefs are there for IHT
Double taxation relief (taxed in 2 countries)
National Heritage Relief