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October 23, 2018 at 11:57 pm
Sir, what is the 1250 figure concerned with and what is the 1500 figure of, and what does 250 means ?
October 31, 2018 at 3:30 am
the figures you mentioned are coupon received when you hold a bond. in simple terms, it is interest income on bonds. coupon is calculated on nominal value of bond i.e. £120,000 the rate is 2.5% per annum. in the example this is payable half yearly(june1.25% and december1.25%). if you hold the stock for 5 months (july to november) you are entitled to 5 months of interest. but here is the tricky part, when you sell it, the purchaser pays you the interest of 5 months which was due, hence £1,250 (already included in the proceeds). now the new holder of the bond will receive £1500 on december, but as he already paid £1250 to the seller he is only assessed on the £250 extra received.
July 10, 2018 at 2:16 pm
Maruf Hossain says
April 19, 2018 at 7:52 am
Hello,I would like to know what has happened to the profit on sales of that stocks because he brought it for 125k and sold it for 127k, so how do we treat that 2k for TAX purpose?
October 31, 2018 at 3:33 am
if im not wrong, in the first 2lines it clearly says that gilt edge securities are exempt from capital gains tax (CGT) when sold. you are only taxed on the interest income part
April 10, 2018 at 2:41 pm
where do i get the solutions from??
June 12, 2018 at 10:04 pm
From the study notes. Starting from Page 167.
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