Module 8 - Chargeable Gains

Question 1

When would an individual not have to report on their capital gains?

Answer 1

When the gains to not exceed £11100 and the proceeds received do not exceed four times this amount / £44400.

Question 2

If you are calculating CGT from a sale non arms length/ connected parties what value do you use for proceeds?

Answer 2

The market value.

Question 3

When working out the Capital gain or loss for a company what must you remember to do?

Answer 3

Index the amounts in the question

Question 4

When carrying out indexation what two things do we need to remember?

Answer 4

1. It has to be rounded to three decimal places.

2. An unindexed gain cannot be turned in to an unindexed loss, nor is it available when there is an unindexed loss.

Question 5

What item gets charged at 18/28% for capital gains?

Answer 5

Residential property

Question 6

What two things must you remember to do when calculating the capital gains on the disposal of a lease holding?

Answer 6

Take the rates from the rates sheet and multiply cost by (disposal/ incurred)

Index the cost

Question 7

Describe the chattel table

Answer 7

1. Gross proceeds are less than £6000 and cost is £6000 and proceeds are < £6000 the loss is restricted to £6k (replace proceeds with £6k)
2. If costs > £6k and proceeds are > £6k normal gain rules are applied.