PTC -disposal of shares

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hanapospis
hanapospis Registered Posts: 111 Dedicated contributor 🦉
Hi Guys,

I am trying to do the exams full paper from Osborn Books and I am having a problem with the disposal of shares. Can anyone help me out?

Apr1986......purchased 300 for 3000
May1990.....purchased 500 for 8500
June1992....Bonus issue 1for5
April1995....Purchased 1000 for 16000
March1999..Sold 400 for 7600

In november 2009 Jeanetta sold all her shares for 45000.

04/86... purchased .... 300.....3000
05/90....purchased .... 500.....8500
06/92....bonus issue...160....... -
04/97....purchased.....1000.....16000
03/99....sold..............400.......7600
________________________________
...............................1560.....19900

Proceeds......45000
Cost............19900
Gain............25100

Will I used 7600 as an amount the shares were sold for or do I calculate the amount as (27500/1960)x400 = 5612? so the gain is 23.112.

Thank you

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  • israrbaig
    israrbaig Registered Posts: 2 New contributor 🐸
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    Shares

    Hi

    I was looking at your questions and i think you 2nd answer is correct. But sadly i may be wrong as just recently i found the whole personnal tax law have changed where index and taper relief have stopped.

    But from questions i have done you would use the 5612 to work out the cost as the 7600 would include profit etc.

    Thanks for the work out

    :laugh:
  • carla030698
    carla030698 Registered Posts: 112 Dedicated contributor 🦉
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    hanapospis wrote: »
    Hi Guys,

    I am trying to do the exams full paper from Osborn Books and I am having a problem with the disposal of shares. Can anyone help me out?

    Apr1986......purchased 300 for 3000
    May1990.....purchased 500 for 8500
    June1992....Bonus issue 1for5
    April1995....Purchased 1000 for 16000
    March1999..Sold 400 for 7600

    In november 2009 Jeanetta sold all her shares for 45000.

    04/86... purchased .... 300.....3000
    05/90....purchased .... 500.....8500
    06/92....bonus issue...160....... -
    04/97....purchased.....1000.....16000
    03/99....sold..............400.......7600
    ________________________________
    ...............................1560.....19900

    Proceeds......45000
    Cost............19900
    Gain............25100

    Will I used 7600 as an amount the shares were sold for or do I calculate the amount as (27500/1960)x400 = 5612? so the gain is 23.112.

    Thank you

    Hi, I beleive you would use your second choice, the way I find it easiest is to list all the purchases, subtotal them and then work out the disposal cost, you dont enter the actual selling price into your pool you enter the value of:

    No of shares sold / No of Shares in the pool x Value of shares in pool.

    in this case giving you £5612.

    The gain is then calculated as:

    Disposal proceeds £7600
    Less: cost (£5612)
    Gain £1988


    Hope this helps! x
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