BTC- chargeable gains

System
System Posts: 100,534 🤖 Admin 🤖
edited June 18 in AAT student discussion
I don't understand how plant and machinery capital allowances link with chargeable gains. Is there a chargeable gain when you sell an asset on which capital allowances have been claimed? I understand that there is not, but what if (and I know it probably never happens) but if you sell an asset for more than its cost and you have claimed capital allowances on it, would there not be a gain? And whats with the chattel sold for over ₤6000 rules? <BR><BR>In the case of Industrial buildings is there always a gain/loss even though capital allowances have been claimed?<BR><BR>I don't understand this. Please help. (My tutor is useless at explaining things)<BR><BR>thanks

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  • System
    System Posts: 100,534 🤖 Admin 🤖
    BTC- chargeable gains

    When you sell an asset that you have claimed capital allowances it gives rise to a balancing charge or a balancing claim. If you sell it for more than the cost price the gain is limited to the cost price, i.e. the charge is never more than the allowances that have been claimed. This works the same as with industrial buildings. Balancing charges are netted off the capital allowances claimed and balancing claims are added to them. Therefore capital gains tax is not applicable.<BR><BR>Annette
  • System
    System Posts: 100,534 🤖 Admin 🤖
    BTC- chargeable gains

    Thank you.
  • System
    System Posts: 100,534 🤖 Admin 🤖
    BTC- chargeable gains

    If the asset is sold for more than cost there will be a balancing charge of all allowances previously claimed, and a gain computed as proceeds less original cost/1982 value.<BR>The exemption for chattels will apply i.e. the 6000 rules.

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