Lecture 3

Question 1

Updated final version
1. Matching rules : what is same day, next 30 days and section 104?

2. Foden example : bought 3,000 5 June 2015, bought 500 17 may 2016 , bought 200 on 9th June sold 800 17 may 2016
   So what is same day, next 30 days and section 104
3. What happens when company gives free shares? E.g darell owned 1,000 and bought it for 4,000. He got 1 for 10 bonus =100 more shares
   So his total was 1,100. In march he sold 1,400 shares for £6. How much is his gain?

Answer 1

1. Same day = buying shares same day , next 30 days =buying shares next 30 days after sale, section 104 holding : pool of all shares not matched yet
2. Focus on how much he sold lets say he sold 800 we know
   500 matches the same day
   200 comes from next 30 days
   500 +200 =700 + 100 = 800
   We need to make 800 so assume 100 comes from section 104.
3. You do not pay bonus shares
   Darell :
   4,000 / 1,100=3.64 ( cost per share)
   Price bought / total shares
   1,400 x 6 =8,400
   1,400 x 3.64 =5,096
   8,400 - 5096=3,304 gain

Question 2

PART 2 OF UDPATED NEW ONE!

1. What is principle private residence? What are conditions to get it?
2. What is full relief ? Or partial relief how do you calculate partial relief
3. What counts occupation? ( 4)
4. What is letting relief + when can you get extra relief ( 3 things)
5. What about if it business use?
6. What if you had more than 1 home?
7. What about married couples and civil partners?

Answer 2

1. If you sell your main home you might not pay cgt because of ppr relief
   - only happens
   - if it was your main home
   - you lived that at some point
2. Full relief = lived there the whole time, partial relief = live there part time. Partial relief :
   Gain x ( occupied months/ total months )
3. Final 9 months before selling it, 3 years away , 4 years working somewhere else in uk , unlimted time working abroad
4. Letting relief = lived property and rented out 2 rooms you may get extra relief from : gain, amount of relief and 40,000
5. Then its not exempt nothing applies you must pay tax but 9 month rule still applies
6. You can elect which one is ppr
   - you must tell hmrc within 2 years
7. Married couples can only have one main home between them.