general cgt Flashcards
chargeable person
*individual or company
* company doesn’t pay cgt it pays ct on profits
* non-residents don’t pay cgt on uk gains unless it is interests in uk land
chargeable disposal
- selling an asset
- gifting an asset
- loss or destruction - provision in legislation making this chargeable in some cases
- death not chargeable - mv at date of death is probate value
- all assets other than cash are chargeable unless on the list of exemptions
exempt assets
- cars are exempt - lorries and vans are not exempt
*wasting chattels are exempt
- “tangible / moveable property” with a life of <50 years
*chattels that are bought / sold for no more than 6k are exempt
- this covers non-wasting chattels such as antiques of low value
- gilts - treasury stock issues by uk gov are exempt
- qualifying corporate bonds are exempt
- Shares in an ISA are exempt
- Shares in VCT (venture cap trust) if within investment limit
- EIS & SEIS (enterprise investment schemes) are exempt subject to conditions
residential and non-residential property
- properties with both residential and commercial elements are split on a just and reasonable basis
- time apportion if use has changed from residential / non-residential
what are the incidental costs of disposal?
- legal fees
- advertising costs
- valuation fees
what acquisition costs are allowable
- legal fees
- commissions
- stamp duty
- SDRT
- SDLT
ways to report capital gains
- online using “capital gains tax on uk property” within 60days of selling
- immediately using “ real time” capital gains tax online service
- annually via self-assessment
which to use depends on asset sold / residency
payment:
1. payments on account within 60 days of disposal
2. via self-assement 31 jan
disposal of uk resi property by uk resi
- must be reported to HMRC within 60 days of completion (online service)
- must include a calculation of the chargeable gain & computation of tax due
- don’t need to report losses
- don’t need to report if covered by AEA
- if more than one disposed of on the same day can go on same form
- separate returns must be filed for joint ownership
- if taxpayer submits a self-assessment must also be reported on the return
-amendments can be made on the return on anniversary of 31 jan - if taxpayer doesn’t file a return then can be amended online within same timeframe
- interest and penalties will be charged for late reporting
property - exchange / completion
- exchange is the day the contracts are made legally binding - deposit usually paid
- completion is date seller must vacate and hand over keys
- exchange date determined the disposal date
- completion date determines the reporting deadline (60days)
- if exchange and completion fall into different tax years then disposal falls into the earlier tax year
- payment on account is due same deadline as reporting (60days)
- best estimate of cgt due
- estimate can take into account cap losses and aea
property exceptions
do not need to be reported if:
* no tax liability arises
- eg if covered be aea, a capital loss or property gains which are extinguished by private residency relief
* NGNL - transfered between spouses / gifted to charity
* disposal already reported via self assessment
don’t have to pay payment on account if there is no obligation to file an online property return
- eg complete on 31st march and then file self assessment before 30th may then don’t have to pay until 31st jan
reporting other assets
- if not already registered for self-assessment then can file realtime transaction return
- can be submitted anytime up to 31st dec following end of the tax year
- need government gateway id etc
- then have a month to pay - 31 jan deadline
- if taxpayer is issues with self-assessment and makes a cap gain, it does not need to be reported if:
- gain is less than aea AND
- proceeds less than 50k
