Please Help - PTX Capital Gains FA2011/12

anniebabe

Hi Guys

Please can someone help me.

I am working through Chapter 6 Questions in the Osborne Work Book - and I am stuck on 6.4
Not sure how they are working it out B to D

Many thanks.

Josie has a capital loss brought forward of £4000. She is a higher rate income tax payer.
She sold an asset during the tax year of £19000.
She had been given the asset by her husband when it was worth £8000.
Her Husband originally paid £6500 for the asset.

(a) The gain on asset is - i worked that out at £12500 (proceeds £19500 less cost £6500)

stuck on the following. if someone could help. my head has gone blank. I have the answers - but it isnt helping at the moment.

(b) The amount of loss that will be relieved is ?

(c) The capital gains tax payabe is ?

(d) The loss to be carried forward to the next tax year is ?

guinea pig

Hi Anniebabe,
We did this in class on Thursday, and I was initially confused by this one. However,
The gain on the asset is £12,500
b) the loss to be relieved is £12,500 less the exempt amount £10,600 = £1,900
c) CGT payable is nil, as £1900 is less than the loss brought forward of £4,000
d) Loss to carry forward is £4,000 - £1900 = £2100

Hope that helps, are you taking the exam soon? we are hoping to take it at the end of this month, so lots to learn!
Good luck
GP

anniebabe

Thats great thank you for replying GP.
I will try and work through that again now.
I am sitting this exam on the 28th - so hopefully will have plenty of time to revise.
I feel confident about section 1 - its section 2 that I am giving my time to now.
There are so many bits of rules to remember - so its just getting in as much practise as possible now.
How are you finding this unit?
Are you doing Business Tax after as well?

anniebabe

GP,

Just reworked that question - Yes, I think that makes a bit more sense to me now.
I was obviously reading far too much into the question (as usual )

Thanks for taking time to help, very much appreciated.