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AAT Practice Assessment 1 Task 11 CGT...HELP!!

Nelson89Nelson89 Registered Posts: 6
Hi.

I am currently going through the AAT PSTX practice assessment and am struggling with task 11.

Question is work out the CGT payable by each person. I have the correct answer for 3 of the 4 but the one i have no idea how the answer has been worked out is Donna.

She sold something to her brother for £19,000, market value is £22,000, cost is £7,500 her other taxable income is £30,000...

Answer = £480

Am i missing something, i have used the market value of £22,000
Cost of (£7,500)
Gain of £14,500
Less AE (£11,100)
£3,400 *10% = £340

Where am i going wrong?

Comments

  • MarieNoelleMarieNoelle Trusted Regular Hampshire/Surrey borderModerator, MAAT, AAT Licensed Accountant Posts: 1,433
    Remember she has already used 30,000 of the basic rate band so only 2,000 is available at 10% and the difference (3,400 - 2,000) is taxed at 20%

    2,000 * 10% = £200
    1,400 * 20% = £280
  • Nelson89Nelson89 Registered Posts: 6

    Remember she has already used 30,000 of the basic rate band so only 2,000 is available at 10% and the difference (3,400 - 2,000) is taxed at 20%

    2,000 * 10% = £200
    1,400 * 20% = £280

    Marie, you are a star. Thank you for answering this for me. I had a feeling it had something to do with her basic rate but i couldn't convince myself that that was the way to answer it. Thank you :)
    MarieNoelle
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