PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

System
System Posts: 100,534 🤖 Admin 🤖
edited 10:26AM in AAT student discussion
CAN SOMEBODY PLEASE EXPLAIN HOW THE SHARES WORK. I JUST CAN NOT GET MY HEAD AROUND THE MATCHING AND THE INDEXING. I KNOW THAT I AM PROBABLY REALLY THICK BUT THERE IS NO WAY I WILL PASS SECTION 2 AT THE MOMENT :oops:

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Hi I failed on Section 2 last June. I now feel that I am fairly confident in passing in three weeks. All I can say is practice and practice and practice. Its not an easy subject to explain in a post on here.
    Basically you are matching the disposals on a LIFO basis to the acquisitions.
    Have you read any text on this subject?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    I have but I think that now I have it in my head I cant do it, every time I look at a question I just go blank. Maybe I will leave it for a few days and concentrate on something else.

    Thanks anyway.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Just thought I would let you know you are not on your own, SHARES scare me, lol.

    Its the indexing and matching and just the whole thing, you have to remember so much, lets just hope a simple one comes up in the exam. Or maybe they might forget to put a SHARES question on the paper.
    (Wishful thinking)

    Han

    :x
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    I think I must be one of the few people who don't have a problem with shares. Unlike much of the rest of the tax rules, the treatment of shares seems pretty logical (well apart from matching shares bought within 30 days after the disposal anyway).

    At the risk of repeating myself, I've some simplified notes on shares here which might be of some use.

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    CJC, Im not too familiar with shares bought after thirty days? Is this examined in AAT? Am I right in thinking it quite simple to do these shares if you remember it as a LIFO excercise within each pool?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Yeah, it's basically just LIFO applied in this order.

    1. Shares bought on the same day as the disposal.

    2. Shares bought in the 30 days after the disposal.

    3. Shares bought between 6/4/1998 and the disposal date. Matching is done on the 'last in, first out principle'.

    4. Any remaining shares not yet matched are deemed to have come from the FA 1985 share pool.

    I've not seen the first two of these come up in any of the past papers though.

    Chris

    Chris

  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    If there are puchases after apr 1998, you do a seperate section dont you??

    Also chris, having a mental block. In what situation do you add a year onto taper relief as bonus? Is it if the asset was held at apr 98?

    (last question i promise)

    Paul
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Yes, you work out the gain on each set of matched shares separately.

    That's right, anything held before 5 April 1998 gets the extra year (as well as being indexed up to that date). I always seem to miscount the number of years when I'm working out taper relief - I know I'm bound to do it in the exam :?

    Ask as many questions as you like Paul, answering helps me get this stuff fixed in my head.

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Thats why I like these forums so much.

    Land.

    Proceeds less the following is gain before taper?

    Proceeds / (Proceeds + Revaluation value) x Cost

    Does that look correct?

    Chattels

    Bought sold under £6000 ignore

    Sold for less than £6000.00 Deem proceeds to be that amount

    Sold for more than £6000 reduce proceeds to 5/3 to restrict taxable gain. Correct?

    I agree that writing things out does help
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    The deemed proceeds of £6000 only apply when a loss is made - everything else looks about right though.

    Don't forget the exemptions on chattels as they seem to like to slip one of those in.

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Wasting chattels? Expected life of 50+ yrs
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Yep, the other two main ones are cars and stuff both bought and sold for under £6000. I've done a past paper and took time to work out the gain on a car disposal and had that doh! moment when I saw the answer.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    Chris, the one thing im stuck on remembering, is unfurnished flat renting. Does anything replace wear and tear, or would it just be coucil tax and interest that comes off?
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    I had to look this up - there's no replacement for W&T on unfurnished lets, just the usual expenses. I think I've only seen furnished properties asked about in the past papers.

    There's also some horribly complicated rules to do with furnished holiday lets that I've not revised (or actually looked at at all!). I think the examiner would have to have been in a particularly bad mood to set questions on that.

    Chris
  • System
    System Posts: 100,534 🤖 Admin 🤖
    Re:PTC - Unit 19 HEEEELLLLLLPPPPPPP!!!!!!

    To CJC:

    Thankyou Thankyou

    at last a simple step by step that i can understand - an extra 20% confident on it now just from reading the link you gave.

    god bless you!!

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