PCT - Have I passed?

System

I'm pretty confident I got pretty much everything correct in the first section but I've got a few worries:

1.I pooled the shares, index up till 1998. Someone mentioned about being able to match some without pooling?

2.Painting - didn't chattle AND put loss of £5k when should have been profit £5k.

3.All shares minus my loss at 100% TR.

4.Said would be nothing to pay on PRR, when should have said she'd most likely be ok if she moved in again for a short time.

Would I be ok on these errors?

System

Re:PCT - Have I passed?

Hi Bry.

No-one knows how they have done til the results come out.

Put it behind you and enjoy your summer :-)

Scott.

System

Re:PCT - Have I passed?

i put all my shares into the pool but stopped indexing at apr 98.
the painting was exempt as the gain was less than £6000
where did the 100% tr come from?
for the last one i said more info would be needed, ie what did she do with the properties when empty - rented out? and where were they, if abroad arent they some certain rules n stuff and can you have the last 3 yrs exempt whether you lived there or not?

Think you'll be fine though, minor errors are fine as long as show workings and carry answer forward.

System

Re:PCT - Have I passed?

You dispose of shares in the following way.
1st - Those bought on the day of disposal.
2nd - Those that will be bought upto 30 days in the future.
3rd - Those after Apr 98 Pool
Last - Those in 98 pool.

So 2500 were worked out seperate to the 500 in the pool. There is an example of this on Task 2.1 of the Dec 03 past paper.

The painting was a loss that should have been allocated to the gain with the least taper relief benefit.
However the proceeds are deemed to be £6000 if it is sold at a loss for less than £6000. Therefore the gain was £8500 - £6000 = £3500.
There was no tax implication on House A as it had been unoccupied for less than 3 years at the end of the total ownership.

System

Re:PCT - Have I passed?

Chattels (painting) was exempt, because the gross proceeds didn’t exceed £6000 (you got it slightly confused with the disposals to the related persons)

Did anyone get the CGT taxable gain in task 2 of £42430, before £8500 allowance ?

Did anyone get STI of 47110 and tax payable £4009.83 in task 1 ?

In the very last task I also put the gain on disposal of house A as exempt.

System

Re:PCT - Have I passed?

I agree with pne. However somebody has told me that the issue of 1 in 4 should have also been calculated on the 500 shares in the pool as well. Which I haven't done.

Painting came under £6000 rule. As cost was more than £6000 and proceeds less than £6000 this meant the proceeds where deemed to have been £6000.

Proceeds 6000
Cost 9500
Loss 3500

House was exempt as came under the 36 month rule.

System

Re:PCT - Have I passed?

Hi

I too restricted the loss on the sale of the painting by replacing the proceeds with £6000 leaving a £3500 loss.

I don't know of any rule about being exempt with a gain of less that £6000 otherwise how do you ever get losses????

I said the property was exempt as it was only vacant for the two years before she wanted to sell it. The last three years of ownership are exempt therefore she doesn't need to move back in first.

System

Re:PCT - Have I passed?

Hi Pne
Yep I concur. Matching was 2500 from most recent holding and 500 from FA 1985 Pool
Loss on Painting I got - £3500, restriction applied.

What about all that car stuff though? I reckon ...
Option 1 was status quo - Excess Mileage Allow (12000 miles @ 50p) - ((10000@40p) + (2000@25p)) = 1500 @ 40% marginal rate = £600 tax reduction

Option 2 was Car Benefit (list £20000? x 20%) = £4000 @ 40% tax = £800 More tax to Pay BUT then claim mileage allowance ((10000x40p) + (2000x25p))= £4500 @ 40% tax = £1800
So then we'd have + £800 - £1800 = £1,000 tax reduction. I didn't put that in the exam and not sure figures are right, I think I went a bit panicky in the exam 'cos there was no space and I was trying to squash everything in, but that's what I think now. What did you all get? Were you supposed to deal with the fact that he was losing his 50p reimbursement or that he'd have to find his fuel money out of his own pocket. All very confusing. So many issues and so little space. (Don't like using back page everything gets split up)

System

Re:PCT - Have I passed?

I had that he pays tax on £1500 excess mileage at the moment. I he gets th company car he pays tax on £4000 and has to pay for his own fuel. Doesn't seem like a great offer to me?

System

Re:PCT - Have I passed?

Oops yes that's better, I think I'm still in crisis. I meant £600 tax payable. So then Option 1 = Extra tax payable £600 versus Option 2 £1000 tax reduction? Wish I'd got Nidhal's photographic memory. Can't remember exact figures in question. Have you seen his PEV threads - phenomenal!

System

Re:PCT - Have I passed?



Section 1
Was not too bad but reading what people have post on here for Task 1 (Rental Income) I worked on the 24 months less the wear and tear allowance and the unpaid rent. The wording of the unpaid rental was unclear as I believe you could have chosen either option. The rest of my answers will be wrong unless they let me use the figure I got.

Section 2
The shares started to match out of the 1985 pool and those since. Then did it the Buisness Tax way!! Idiot!

Then the painting - I treated it as a loss of £9500 - £4000 to give £5,000 because my understanding was that chattels are bought and sold for under £6,000 and this was bought for more than £6,000.

Land okay

My Taper relief percentages may have been wrong as I was running out of time and could not work out the years I had 80% for the shares as one computation and 70% for the land.

I could do the income tax computation

CGT I aportioned as some of the 20% rate left and then the rest 40%.

The House I confirmed the PPR rules. Showed the formula. Stated that the £120,000 would also have Indexation allowance. Also included that I would need to confirm their occupation periods to confirm the liabality/no liability.

Oh well taught myself PT as too late for a local college course really depressed now when I should be relieved its all over - but using leave for revision etc means that not much leave left to enjoy the summer

Well done to all those who found the paper okay I would rather do PEV and PCR any day! People who say tax is easy then do not believe them.

System

Re:PCT - Have I passed?

My teacher said the painting was a loss of £1500 because it couldn't exceed a certain amount (can't remember now, think it may be however much less the real proceeds was from £6000). I got £3500, so 1 point dropped there.

System

Re:PCT - Have I passed?

Also a bit worried why people exempted the house from tax. You can only exempt the unoccupied period and the 3 years, the rest is taxable as she owned and lived in it from 1995 to 2004.

System

Re:PCT - Have I passed?

Hey all. Glad the exams are now over.

Checking the forum to see where i may have gone wrong. On the last question, i agree that the period in which the house was occupied is exempt.

My text book says, If the owner occupies their house during the period of ownership, this period is exempt from the taxable gain. If there have been periods where the owner has not lived in the property, these may also be exempt if the periods can be classed as deemed occupied.