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Chapter 13 - Chargeable gain - Coggle Diagram
Chapter 13 - Chargeable gain
Scope of capital gain tax
Chargeable person: Individual in the UK & Company in the UK
Chargeable disposal: Sale at market value, Gift or sale less than market value, loss or destruction of asset
Chargeable asset: All but except
Cars
UK gov stocks
Qualifying corporate bonds
Wasting chattels
Foreign currency bank account held by individuals
Medal award or inherited (not purchase)
National savings cert and premium bonds
Gambling winning
Inventory and other current assets
Investment in ISA
CGT payables by individuals
Annual exempt amount for CGT = 12,000
Adjust limit for gift aid donations and personal pension contribution
Annual exempt and losses should be used to reduce residential property gains first
Due date: For gains in 19/20, due date is 31 Jan 2021
Year-end computation
Unused annual exempt can't be brought forward in CGT
Losses should be offset against residential gains first
When losses are c/f, they need to use to bring down the gain to zero after deducting annual exempt amount
Part disposal
Proceeds - Selling costs - Original cost of whole asset * MV of the part disposed (A) / MV of the whole asset (A+B)
Transfers between spouse/civil partner
Can't transfer annual exempt amount between spouses
Transfers of asset between spouse are no gain/loss basis
Recipient spouse is treated as if bought the asset for a price equal to MV
Compensation & insurance money
Damaged asset
Treated as part disposal: A / (A+B) apply where A = compensation received & B = unrestored value of assets
Tax payers can ignore part disposal
Destroyed asset
If asset is fully destroy, disposal and compensation will be wholly charged to CGT
If reinvested within 12 months, roll-over relief may be available
Reinvestment must be in scope of CGT and similar to the destroyed one