Personal Tax Help please

System

I am using the BPP book, and working through the revision questions in the second part of the book. I have a query on chapter 8 Shares - question 1.

Please could someone explian it to me.

It involves calculating the capital gains liability. I understand all of it except, in the answer, the sale of 3000 in October 1987 do not seem to be liable for capital gains tax, they are just deducted from the 1985 pool, and no allowance for any gain in made. please could someone explain to me why this is done?

Many thanks

Anne

System

Re:Personal Tax Help please

Perhaps you could give more details to your question i.e. if there are other shares sold i.e. purchased shares and bonus/rights issues and the indexed value of the FA85 pool. I think there might be as shares matched with the FA85 pool are the last lot of shares to be matched under the Matching Rules. I won't be around to answer the question for you as I won't be on the forums for the next few days - but I'm sure there will be others that can solve your query.

Shares sold by an individual which are matched to the FA85 pool can be subject to taper relief but without the dates of when the other shares were bought and details of the sale it is difficult to work any gain out.

Kind regards
Steve

System

Re:Personal Tax Help please

Hello Anne

Without seeing the question, its difficult to answer, but I think I came across a similar scenario in a question and queried the earlier disposal.
It was explained that the taper relief and any gain on disposal, would have already been worked out in a previous year, so all you need to do is show the disposal in the workings for the FA 1985 pool to work out the most recent disposal gain.

Hopefully this makes sense.

Yas

System

Re:Personal Tax Help please

Hi Yas

Many thanks for that. It makes sense now,as the earlier disposal would have been liable for CGT in a previous year.Its obvious now.

Thanks
Anne