entrepreneur relief question aat level 4 2016
Jamesw
Registered Posts: 2
in Business Tax
hi can somebody help me with this question please?
Ranjit sold a business in July 2012 and made a gain of £7,500000
in Feb 2017 sold another business making another gain £4,000000
Neither of these business are residential properties
Ranjit used her annual exemption on other capital disposals.
How much capital gains tax on the disposal Feb 17.
The answer is £550,000 but I dont understand how! can you help?
Ranjit sold a business in July 2012 and made a gain of £7,500000
in Feb 2017 sold another business making another gain £4,000000
Neither of these business are residential properties
Ranjit used her annual exemption on other capital disposals.
How much capital gains tax on the disposal Feb 17.
The answer is £550,000 but I dont understand how! can you help?
0
Comments
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Entrepreneur's relief on £10m, less the £7.5m in 2012, leaves £2.5m
CGT 10% x £2.5m = £250,000
This leaves £1.5m (£4m - £2.5m)
There is no basic rate band left, it has been consumed by the £2.5m
GCT 20% x £1.5m = £300,000
250,000 + 300,000 = £550,000
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Old transactions are relevant because the £10million relief has to cover your whole lifetime.0
