Personal tax task 1.9b

clara

Please help
Joyce bought asset in 2002 for £105,000 and sold it November 2015 for £148600. She paid auctioneer commission of 7.5% when she bought asset and auctioneers fees of 10% on the sale value of asset. What is gain arising from disposal of asset. The answer is £20865. Thank you

Tishat121

Hi Clara
Brought the asset for £105,000 plus 7.5% commission
£105,000/100x107.5 = £112,875 (Asset brought price)
Sold asset for £148,600 which include auctioneers fees of 10%
£148,600 - 10% (14,860) = £133,740

Difference between the brought and sold price is
£133,740-£112,875 = £20,865

Hope this helps. You add on the commission price to the brought price and for the sale you take away the auctioneers fees then the difference between the two is your answer