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For chargeable gain for companies we use the indexation cost to reduce the chargeable gain that may arise.
In BPP texts books sometimes, after working out the RPI change over the RPI at acquisition, they round the figure to 3 decimal points and at other times they leave the full value.
Are there a set of rules to follow when to round to 3 d.p.? It obviously makes a difference to the answer and i do not want to lose marks over this tiny issue.
Thanks
You use a 3 dp indexation factor in ALL but one situation – when reindexing the share pool on purchase and sale of shares
Thank you. Sorry for being thick but for share pool then, we use the figure on our calculator (more than 3 dp)?
Correct just leave the figure in your calculator and multiply by the indexed cost amount
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