Person tax question

Lee

Hi guys can someone please help me with how question 7.5 (b) has been worked out to get answer £5200 - in Osborne workbook page 28.
My working ;
10/(10+15)*12= £4800.

Thanks for yr help

Lee

reader

Lee wrote: »

Hi guys can someone please help me with how question 7.5 (b) has been worked out to get answer £5200 - in Osborne workbook page 28.
My working ;
10/(10+15)*12= £4800.

Thanks for yr help

Lee

If you type out the question I'm more than happy to take a look at it.

Lee

reader wrote: »

If you type out the question I'm more than happy to take a look at it.

A quarter acre piece of land was sold for £10,000. It had been bought as part of the two-acre plot for £12000. The remaining land was valued at £15000 at the time of the sale.


The gain on the land is:

reader

Lee wrote: »

A quarter acre piece of land was sold for £10,000. It had been bought as part of the two-acre plot for £12000. The remaining land was valued at £15000 at the time of the sale.


The gain on the land is:

Cost of land = 12,000

Proportion of land sold = 10, 000 / (10, 000 + 15, 000) = 0.4

Therefore proportion of cost deductible against gain = 12, 000 x 0.4 = 4, 800

Capital gain = 10, 000 - 4,800 = 5, 200

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I've taken a look at your answer and you have only calculated cost. The question asked for gain, i.e. sale proceeds - cost.

Lee

Oops, thank you so much, you are right, just these little mistakes will cost me good marks.

lee