TAX(sep24) Capital Gain CH-19 to 22

Which of the following gifts made by an individual is exempt from capital gains tax?

• Gift of a motor boat valued at £10,000 (cost £5,000) to his aunt

• Gift of unquoted shares in a United Kingdom company valued at £2,500 (cost £1,800)

  to his brother

• Gift of antique jewellery valued at £6,800 (cost £3,200) to his sister

• Gift of a sculpture valued at £3,000 (cost £10,000) to his nephew

September/December 2021 OT question (ADAPTED)

Naomi realised a chargeable gain of £23,700 in the tax year 2023/24. The gain related to the

disposal of a residential property held for investment purposes and did not qualify for

business asset disposal relief.

In the tax year 2023/24, Naomi had taxable income of £29,700 and she contributed £2,000

(net) into her personal pension scheme.

What is Naomi's capital gains tax liability for the tax year 2023/24?

• £3,906

• £5,586

• £4,156

• £5,836

March/June 2022 OT question (ADAPTED)

Brian had the following income and chargeable gains for the tax year 2023/24:

£

Employment income

43,000

Chargeable gain from the sale of an antique vase

11,700

What is Brian's capital gains tax liability for the tax year 2023/24?

• £1,613

• £2,340

• £570

• £1,140

September 2016 OT question

Putting an asset into joint names with a spouse (or a partner in a registered civil partnership)

prior to the asset’s disposal can be sensible capital gains tax (CGT) planning.

Which of the following CANNOT be achieved as a direct result of using this type of tax

planning?

• Making the best use of annual exempt amounts

• Deferring the CGT due date

• Reducing the amount of CGT payable

• Making the best use of capital losses

Which TWO of the following statements about allowable capital losses for an individual are

true?

• The annual exempt amount is deducted before any brought forward capital losses are

  utilised against current year gains

• Current year capital losses remaining after offset against current year chargeable gains

  can always be offset against current year income

• The annual exempt amount is deducted before any current year capital losses are

  utilised against current year gains

• Excess current year capital losses are carried forward indefinitely until future

  chargeable gains arise

Liam purchased an antique glass vase for £22,000 on 30 March 2008, incurring legal fees of

£800.

The market for antique glassware has since slumped and Liam sold the vase for £5,500 on 1

January 2024 incurring auctioneer fees of £300.

What is Liam’s allowable loss on this disposal?

• £16,000

• £16,800

• £17,100

• £17,600

September 2015 OT question

On 31 March 2024, Jessica sold a copyright for £28,800. The copyright had been purchased

on 1 April 2018 for £21,000 when it had an unexpired life of 15 years.

What is Jessica’s chargeable gain in respect of the disposal of the copyright?

• £0

• £20,400

• £16,200

• £7,800

Habib purchased a copyright on 30 April 2007 for £31,320. The remaining life of the copyright

at the date of purchase was 30 years. On 30 April 2023, Habib sold the copyright for £27,900.

What is Habib’s chargeable gain or allowable loss for the tax year 2023/24 in respect of the

disposal of the copyright?

• (£3,420)

• £11,196

• £0

• £13,284

Lotte purchased a freehold warehouse on 24 November 2018 for £52,000. On 30 June 2023,

the warehouse was destroyed in a fire.

On 28 August 2023, Lotte received insurance proceeds of £71,000. She spent £64,000 of the

proceeds on a replacement warehouse on 29 January 2024.

Assuming that, as far as possible, Lotte claims to defer any chargeable gains arising in the

tax year 2023/24, calculate the carried forward base cost of the new warehouse purchased

on 29 January 2024.

• £45,000

• £52,000

• £57,000

• £64,000

On 10 January 2024, a freehold property owned by Winifred was damaged by a fire. The

property had been purchased on 29 May 2011 for £73,000. Winifred received insurance

proceeds of £37,200 on 23 February 2024, and she spent a total of £41,700 during March

2024 restoring the property. Winifred has elected to disregard the part disposal.

What is the base cost of the restored freehold property for capital gains tax purposes?

• £68,500

• £77,500

• £114,700

• £35,800