Tax

Question 1

What are the rates for CGT (Oct 2024 onwards)?

Answer 1

• For individual: 18% basic rate, 24% higher rate including residential property gains ‘RPG’ (used to be 10 and 20% for non-RPG)
  *24% for trustees and personal reps including RPG
• 10% for gains qualifying for Business Asset Disposal Relief

Question 2

What is the annual exempt amount for CGT?

Answer 2

• £3,000 for individuals, PRs and trustees for disabled people
  *£1,500 for other trustees
• PRs have annual exempt amount for tax year that death occurred in and then further 2 years - after that no tax-free allowance against gains during the administration period

Question 3

What is Business Asset Disposal Relief?

Answer 3

• Tax is reduced to 10% on gains for the disposal of business assets
• Must have owned the business for at least 2 years and must be a sole trader or business partner

Question 4

What are the rates for income tax?

Answer 4

• £12,570 Personal Allowance
• £12,571 - £50,270 (£37,700) = 20%
• £50,271 - £125,140 = 40%
• Anything above that = 45%
  *Personal allowance goes down by £1 for every £2 above £100,000 = salary above £125,140 has no personal allowance

Question 5

How is tax on dividends calculated?

Answer 5

• Allowance £500
• Basic band: 8.75%
  *Higher: 33.75%
  *Additional: 39.95%

Question 6

How is Stamp Duty calculated if you own only one residential property?

Answer 6

*Up to £250k = 0&
* £250,001 - £925k = 5%
* £925,001 - £1.5 million = 10%
* Above that = 12%
* 5% extra if buying new residential prop = will own more than one

Question 7

What is the first time buyer’s relief on SDLT?

Answer 7

• Up to £425k = no SDLT
  *£425,001 - £625k = 5%
• No relief if above that

Question 8

What is the rate for SDLT on non-residential freeholds?

Answer 8

*£125k = 0
* £125,001 - 250,000 = 2%
* Anything above = 5%

Question 9

What is the rate for SDLT on non-residential leaseholds?

Answer 9

*New lease = pay on purchase price AND annual rent value
* £125k = 0
* £125,001 - £5m = 1%
* Above that = 2%