CGT Flashcards
CGT exempt assets
Gilts, Main Residence, ISA’s, Private motor vehicles, chattels with less than £6k, foreign exchange, gambling winnings, VCT’s & EIS’s and NS&I
Chattels Relief
Sale price - allowance (£6k) x 5/3
CGT Losses
Not all of the losses need to be used in full. A loss incurred in the same year must be offset against current year gains. However losses must be used within 4 years of the end of the tax year relate to
Share Pooling
Share identification Sold 5000 shares @ £5 on 1/9/17 But bought 4000 @ £4.50 on 13/9/2017 3000 @ £3 on 1/3/14 3000 @ £2 on 1/3/12 All purchases in the following 30 days must be reviewed Share pool = 6000 shares costing £15k which = £2.50 per share. This is used as the acquisition cost
Holdover Relief
Can be used to defer the capital gain on the transfer. No CGT is payable at the time. The gain will be taxable upon future sale or if in a trust absolutely entitlement
EIS
A chargeable gain can be deferred by investing in an EIS. This would defer any liability. However, the reinvestment must take place within a period starting 1 year before and ending 3 years after the share disposal. The gain comes back into charge when the EIS shares are disposed of unless another EIS is done.
Disposal of shares in a bare trust
Tax is charged on the beneficiary and their CGT allowance is used
Letting relief
Is the lower of the principal residence relief that applies to be property or chargeable gain or £40k
Apportionment
Final 18 months of property that was main residence at 1 point is exempt as part of the apportionment calculation
Calculating the gain on inherited property
The probate value is used as the acquisition cost when calculating the gain
What’s the annual exempt amount for CGT
£11,700
What’s the annual exempt amount for a Trust with a capital gain?
£5,850
