OpenTuition | ACCA | CIMA
Free ACCA and CIMA on line courses | Free ACCA, CIMA, FIA Notes, Lectures, Tests and Forums
Spread the word
If you have benefited from our materials, please spread the word so more students can benefit.
To help us keep materials up to do and add new content you can also donate
December 12, 2019 at 3:58 pm
Please see below question. Can anyone tell me why the incidental costs of acquisition of 1,500 were not used to calculate the unindexed gain?
Greenwood Ltd. disposed of an investment property on 31/12/2018.
He received disposal proceeds of £115,000 for the property and incurred legal fees on disposal of £5,000.
He has initially purchased the property for £15,000 and incurred incidental costs on acquisition of £1,500 on 31/12/2008.
He had spent £25,000 to extend the property on 31/12/2010.
Relevant indexation factors are:
On cost 0.306
On enhancement .0218
What is his capital gain for the tax year 18/19?
Disposal proceeds £115,000 Incidental costs to dispose (£5,000) Net sale proceeds £110,000 Acquisition cost (£15,000) Extension cost (£25,000) Unindexed gain £70,000 Indexation allowance for acquisition (£5,049) (W1) Indexation allowance for extension (£5,450) (W2) Capital gain £59,501
December 12, 2019 at 4:32 pm
Please post such questions on the Ask the tutor Forums! this comment will be deleted
January 21, 2020 at 4:29 pm
Hi I think it is because of the year 2008. I am not sure
February 7, 2019 at 1:39 pm
Great and simplified lectures… Thanks a lot Sir
You must be logged in to post a comment.