Flashcards in The Capital Gains Tax Chapter Deck (21):
Exempt Assets from chargeable Gains Tax
GT edged securities and qualifying corporate bonds
National savings certificates and premium bonds.
Assets held in New Individual Savings Accounts
Annual Exempt AmountTaxable Gain.
LessIncidental costs of disposal
Net disposal consideration
Less: Allowable expenditure
Cost of acquisition
Incidental costs of acquisition
General Rule the disposal consideration is the proceeds received for the asset.
Exception use market value when-
The sale was not made at arms length eg a gift...
Deduct incidental costs of disposal. Examples include auctioneers fees estate agent fees and legal costs.
Deduct the acquisition cost of the asset-
Purchase price of bought
Market value if gifted
Probate value if inherited
Enhancement expenditure- new extensions, architects fees.Incidental costs of acquisition eg legal fees, surveyors fees.
Where only part of an asset is disposed of the acquisition cost
A-Market balue when disposed
B-Marker value of part retained
Beth makes the following gains and losses
Asset 1-Gain of 2000
Asset-Loss of 6500
Asset3-Gain of 12500
The brought forward
The capital loss brought forward.
Must be offset against first available future gains.
Must preserve the annual exemptions.The net gain is made equal to the annual exemption (11100).
Offset trading losses with the gains!!!
This is possible in the tax or the Prior!!!
To determine the trading loss which is allowed is
Loss remaining from the trading
Capital Gains Tax Payable For Individuals and Trustees
Rates of CGT for individuals
Basic Rate Bands-18
Excess of Basic Rate Bands-28
Rates if CGT for trustess
Rate of tax for trustess
In a bare trust the assets are treated as belonging to the beneficiary personally so any gain/loss on disposal is treated in the beneficiary as normal rather then the trustees.
Payments of CGT in instalments
CGT could be paid in instalments-if arising out of gift
-shares in a company-controlling holding
-share in unquoted company
Payable election 10 instalments annually
Interest normally chargeable on outstanding balance...
Husband and wife(civil partners) are taxable as separate individuals
Both entitled to separate annual exemption-naughty!!!
Transfers between married couples/civil partners
When assets are transferred between two spouses no gain or loss arises.
The transferor is deemed to dispose of the asset at its acquisition costs...
These rules only apply when the spousesliving together not seperated.
Two people are connected if-
-relatives/relatives of spouses
-business partners and their spouses /
Chattels are tangible moveable property.
There are two types of chattel
Not exceeding 50 years-exempt from CGT.
More than 50.years.
Antiques Jewelry Paintings
Disposal of shares by an individ.
It is necessary to identify which shares have been sold.
Match shares disposed of against same class of shares acquired.
Within the following 30 days on FIFO basis.
S104 Pool-Shares bought before the disposal date...