# Chargeable gains

### Test your understanding

(1). For the tax year 2017-18, Som has chargeable gains of £22,900. She has unused capital losses of £26,100 brought forward from the tax year 2016–17.

What amount of unused capital losses will Som carry forward to the tax year 2018–19?

A  £26,100
B  £0
C  £14,500
D  £3,200

(2).
For the tax year 2017–18, Alistair’s taxable income is £29,840. During the year he sold an antique vase and this resulted in a chargeable gain of £32,900.

What is Alistair’s CGT liability for the tax year 2017–18?

A  £3,954
B  £6,214
C  £4,320
D  £2,160

(3).
Dash Ltd sold a factory on 7 February 2018 for £260,000. The factory was purchased on 4 July 1997 for £114,000. Retail price indices (RPIs) are 157.5 for July 1997 and 275.0 for February 2018.

What is Dash Ltd’s chargeable gain in respect of the disposal of the factory?

A  £146,000
B  £37,084
C  £60,952
£60,956

(4).
Jade sold 25,000 £1 ordinary shares in Silver plc on 13 March 2018. Jade had purchased 60,000 shares in Silver plc on 18 February 2009 for £72,000. On 24 May 2012, 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

The following scenario relates to questions 5–9.

Jay disposed of various assets during the tax year 2017–18, and these disposals resulted in chargeable gains of £45,400 qualifying for entrepreneurs’ relief and another £122,600 of chargeable gains not qualifying for entrepreneurs’ relief. None of the gains are residential property gains. Jay’s disposals included the following:

(1). On 19 April 2017, Jay sold five acres of land for £72,000. He had originally purchased eight acres of land on 7 June 2008 for £68,000. The market value of the unsold three acres of land as at 19 April 2017 is £40,500.

(2). On 8 June 2017, Jay sold an antique table for £12,800. The table had been purchased on 2 May 2006 for £1,300.

(3). On 19 October 2017, 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 2018, Jay sold a factory and this disposal resulted in a chargeable gain.

Jay does not have any taxable income for the tax year 2017–18.

Required:

(5). What cost figure will have been used in calculating the chargeable gain on the disposal of Jay’s five acres of land?

A  £42,500
B  £68,000
C  £46,080
D  £43,520

(6). 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

(7).
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
£10.31 per share
C  £10.42 per share
D  £10.64 per share

(8).
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 2017 to 10 March 2019
B  10 March 2018 to 10 March 2021
C  10 March 2017 to 10 March 2021
D  10 March 2018 to 10 March 2019

(9).
What is Jay’s CGT liability for the tax year 2017–18?

A  £23,450
B  £26,800
C  £25,710
D  £29,060