Capital Gains Tax Flashcards
What is the rate of tax due on trust gains on non-residential property? (24-25 guidelines)
24%
What is the rate of tax due on residential property? (24-25 guidelines)
24%
Period within which CGT must be paid on completion of a UK residential property disposal?
60 days
For CLT how to much tax to pay over the NRB?
20%
Jo made a CLT of £400,000 and six years later, she made another chargeable transfer
of £200,000. Both figures are after deducting annual exemptions and in each case, the
trustees paid any IHT due. Jo had made no previous transfers.
Jo dies two years after the second transfer.
Calculate the Lifetime IHT.
Calculate IHT on death.
400k-325k x 20% = 15k
200k§ x 20% = 40k
Lifetime IHT 55k
§ the second transfer was made within the 7 years from first transfer therefore NRB is used by the first transfer
0 on first transfer as died after 7 years.
200k x 40% as died within 2 years so no taper, but have already paid 20% so remaining amount is 200k x20% = 40k
Can loan that are used to purchases asset that qualify for business relief be deducted from total asset?
no
What is included in the agricultural property?
agricultural land, growing crops and farm building
What is not included in the agricultural property?
The animals and equipment
Agricultural relief is given on what?
Relief is given on the agricultural value of the land.
Do you get agricultural relief on any development value?
No, agricultural property does not include buildings on their own.
Is there any relief on any excess of the open market value of a farmhouse over its agricultural value?
No
Note: Relief may be denied entirely if the occupier of the farmhouse is not involved in farming the land on a day-to-day basis.
When agricultural relief and business relief both available which one is given first?
Agricultural relief
If let land under tenancies what relief is given?
50%, unless the duration of tenancies exceeds 12 months that started after 31 August 1995
What does it mean by owner-occupied farms and how much relief do you get?
The farm is owned by the owner, and 100! relief
What does it mean by farm tenancies and how much relief do you get?
Where the land is occupied under a farm tenancy and farmed by the tenant, and 100% relief is given to the owner or tenant on transfer to a family member or eligible recipient with out paying IHT on the agricultural value of the land.
What are the things that qualify for business relief?
-Unquoted shares in trading companies (not investment)
-Partnership interests in trading businesses
-Trading property, such as land and machinery used in an active business
-Goodwill of a trading business
What does not qualify for business relief?
-Residential property
-Land or property held purely for investment or development purposes
