Explain the taxation implication of an asset acquisition for the buyer and seller.

Tax Implication for Seller and Buyer in an Acquisition

Quiz
•
Business
•
University
•
Easy
Tingting Song
Used 1+ times
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33 questions
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1.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
The buyer may benefit from depreciation deductions, while the seller may face capital gains tax.
The buyer faces capital gains tax, while the seller benefits from depreciation deductions.
Both buyer and seller face no tax implications.
The buyer and seller both benefit from tax credits.
2.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Explain the taxation implication of a share acquisition for the buyer and seller.
The buyer may face capital gains tax, while the seller may benefit from tax deductions.
The buyer may benefit from tax deductions, while the seller may face capital gains tax.
Both buyer and seller face no tax implications.
Both buyer and seller benefit from tax deductions.
3.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What topics are covered under the Taxation of Chargeable Gains Act 1992 in the reading list?
Capital gains tax
Inheritance tax
Value added tax
Income tax
4.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
For tax purposes, what must be specified in the agreement regarding the consideration attributed to each separate asset?
The total value of all assets
The consideration attributed to each separate asset
The tax rate applicable to each asset
The depreciation method for each asset
5.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
The parties have some flexibility in making the apportionment of consideration. What are they usually influenced by?
Tax implications
Legal requirements
Market conditions
Personal preferences
6.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
What is the tax implication for a seller when selling an unincorporated business for cash in the UK?
No tax
Income tax only
Capital gain tax only
Both income tax and capital gain tax
7.
MULTIPLE CHOICE QUESTION
30 sec • 1 pt
Fill in the blank: The seller will be liable to Capital Gain Tax (CGT) on any gain that arises on the disposal of chargeable assets of the business, such as land, building, and goodwill, at the rate of ___% (on gains falling within their available basic rate tax band).
10
15
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25
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