Chapter 13: Chattles and wasting assets

Question 1

What are chattels

Answer 1

Moveable tangible property

something you can see touch and move

Question 2

Wasting chattels (life under 50 years)

Answer 2

EXEMPT

Question 3

Wasting chattel - Plant and machinery

Answer 3

Plant and machinery are always a wasting chattel UNLESS they are sole for a profit

then treat as non wasting chattel

losses are ignored because capital allowances was claimed

Question 4

Gross proceeds and cost under £6000

Answer 4

EXEMPT

Question 5

Gross Proceeds exceed £6000, cost under

Answer 5

Taxed on lower of:

5/3 (Gross Proceeds - £6000)
The normal gain

Question 6

Losses of wasting chattel

what are gross proceeds

Answer 6

Deemed proceeds are £6000 (before selling costs)

Question 7

Gross proceeds and cost both over 6000

Answer 7

normal gain or loss

Question 8

wasting assets (copyright with 20 year lease etc)

Answer 8

cost is depreciated on straight line

eg

buy 20 year copyright for £10,000
sell 5 years later

deemed cost is 10000*15/20=7500