Test your understanding
(1). For the tax year 2022–23, Som has chargeable gains of £23,900. She has unused capital losses of £26,100 brought forward from the tax year 2021–22.
What amount of unused capital losses will Som carry forward to the tax year 2023–24?
A £26,100
B £0
C £14,500
D £2,200
(2). For the tax year 2022–23, Alistair’s taxable income is £34,040. During the year he sold an antique vase and this resulted in a chargeable gain of £33,900.
What is Alistair’s CGT liability for the tax year 2022–23?
A £3,954
B £6,414
C £4,320
D £2,160
(3). Dash Ltd sold a factory on 7 February 2023 for £260,000. The factory was purchased on 4 July 1997 for £114,000.
The indexation factor from July 1997 to December 2017 is 0.766.
What is Dash Ltd’s chargeable gain in respect of the disposal of the factory?
A £146,000
B £34,164
C £0
D £58,676
(4). Jade sold 25,000 £1 ordinary shares in Silver plc on 13 March 2023. Jade had purchased 60,000 shares in Silver plc on 18 February 2014 for £72,000. On 24 May 2017, Silver plc made a 1 for 4 bonus issue.
What cost figure will be used in calculating the chargeable gain on the disposal of Jade’s 25,000 ordinary shares in Silver plc?
A £6,000
B £24,000
C £25,000
D £30,000
(5). During March 2023, an investor made four disposals of shares in unquoted trading companies. Which disposal could qualify for investors’ relief?
A Shares purchased from a shareholder during July 2018
B Shares acquired by subscription during June 2019
C Shares purchased from a shareholder during March 2022
D Shares acquired by subscription during August 2020
The following scenario relates to questions 6–10.
Jay disposed of various assets during the tax year 2022–23, and these disposals resulted in chargeable gains of £46,400 qualifying for business asset disposal relief and another £123,300 of chargeable gains not qualifying for business asset disposal relief. None of the gains are residential property gains. Jay’s disposals included the following:
(1). On 19 April 2022, Jay sold five hectares of land for £72,000. He had originally purchased eight hectares of land on 7 June 2013 for £68,000. The market value of the unsold three hectares of land as at 19 April 2022 is £40,500.
(2). On 8 June 2022, Jay sold an antique table for £12,800. The table had been purchased on 2 May 2011 for £1,300.
(3). On 19 October 2022, Jay made a gift of his entire shareholding of £1 ordinary shares in AMZ plc to his son. On the date of the gift, the shares were quoted at £10.20 – £10.64.
(4). On 10 March 2023, Jay sold a factory and this disposal resulted in a chargeable gain.
Jay does not have any taxable income for the tax year 2022–23.
Required:
(6). What cost figure will have been used in calculating the chargeable gain on the disposal of Jay’s five hectares of land?
A £42,500
B £68,000
C £46,080
D £43,520
(7). What is Jay’s chargeable gain in respect of the disposal of the antique table?
A £11,333
B £4,080
C £11,500
D £6,800
(8). What market value figure will have been used in calculating the chargeable gain on Jay’s gift of AMZ plc shares?
A £10.20 per share
B £10.31 per share
C £10.42 per share
D £10.64 per share
(9). During what period must reinvestment take place if Jay wishes to claim rollover relief in respect of the chargeable gain arising on the disposal of the factory?
A 10 March 2022 to 10 March 2024
B 10 March 2023 to 10 March 2026
C 10 March 2022 to 10 March 2026
D 10 March 2023 to 10 March 2024
(10). What is Jay’s CGT liability for the tax year 2022–23?
A £23,070
B £26,840
C £28,070
D £29,300
Answers
