Chargeable Gains for Individuals Flashcards
(32 cards)
What % tax applies to gains that fall into the individual’s unused BRB
10% for non resi 18% for resi
What % tax applies to gains that are over the BRB
20% for non resi 24% for resi
Which gains should be taxed first, resi or non resi and why
Non residential gains should be taxed first to use the remaining basic rate band and avoid the 10% extra tax in the higher rate
How much is the AEA
£3,000
What should the AEA be used against first
Residential gains
When is CGT payable
31 January
When must an individual submit a UK land return after disposing of a property
Within 60 days of completion
In which cases is a UK land return not required
If the gain is covered by private residence relief
If the disposal gives rise to a loss
If the gain is covered by the AEA
In the case of a capital loss, how far must the current year gains be offset
Current year losses must be deducted in full from any current year gains
What are excess capital losses carried forward against?
Future chargeable gains
What should current year capital losses be offset against first?
Residential gains
When are brought forward capital losses deducted
After current year capital losses and the AEA
What must brought forward capital losses be offset against first
The first available net gains
What arises when assets are transferred between spouses or civil partners
No capital gain or loss
What cost is the transferor deemed to dispose the asset at
Acquisition cost
What are the deemed proceeds for transfers between connected persons not covered by the NGNL rules?
At market value of date of disposal
What is the formula for part disposals cost and explain the variables
Cost x A/(A+B)
A = market value of part disposed of
B = market value of part retained
How are incidental costs or enhancement expenditure treated during part disposals
If they relate solely to the part sold, deduct in full
If they relate to the whole asset, apportion in the same way as cost
What is the order for the matching rules when disposing shares
Shares acquired on the same day as disposal
Share acquired within the following 30 days of the disposal on a FIFO basis
s104 pool: shares brought prior to disposal date
Where do the extra shares go in a bonus issue when calculating the gain on disposal of shares
Into the s104 pool at nil cost
Where do the extra shares go in a rights issue when calculating the gain on disposal of shares
Add the new shares and their cost into the s104 pool
What is the formula to value gifts of quoted shares for CGT purposals
Lower quoted price + 1/2(higher quoted price - lower quoted price)
What are the main exempt assets for CGT purposes
Cash
Cars
Bonds
Certificates
ISAs
Wasting chattels life < 50 yrs
Non wasting chattels bought and sold for < £6,000
HRPT/ARTP CGT rate
20%
