Capital gains tax Flashcards
If calculating IA on a cost which has had an improvement throughout the period of ownership, what should you do?
Calculate two IA’s. One for the original cost, from the purchase date up to the date of disposal. and another for the improvement cost, from the date of improvement to disposal
What is the part disposal formula
Cost * (proceeds/(Market value of remaining part + proceeds)
What is the time period for rollover relief to be applicable?
The new asset must be purchase either 1 year before or 3 years after the sale
Is SSE relevant to companies or individuals?
Companies
SSE stands for?
Share sale exempt
What are the three T’s for SSE relief?
Trading
Ten %
Twelve months in last 7 yrs
When is a de-grouping charge exempt?
If SSE is applicable
Valuation of shares method?.
1/2 up rule
L + 1/2 (H-L)
What does PRR stand for
Private residence relief
What are the four rules for PRR?
Last 9 months.
3 years any reason (if proceeded and followed by actual)
Anytime in overseas employment
4 years working elsewhere in UK.
PRR Formula?
Gain * ((actual + deemed occupation) / ownership time)
What is lettings relief the lower of?
Lower of:
PRR, or
£40,000
Rollover relief:
How long is gain deferred if the new asset is depreciating?
Earliest of:
Disposal,
10 years, or
No longer used in trade.
When is gift relief relevant?
When a business asset is gifted to an individual for less than MV.
What is a business asset for gift relief?
Unquoted shares
Quoted - < 5% owned
Assets used in trade
