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  • Tax - Claim for relief for damaged asset
    Claim for relief for damaged assetCapital gains tax may be payable on capital sums which derive from assets. For example, compensation payable to you for damage to an asset. However, if you use the amount received to repair or restore the asset, you might be entitled to defer the tax.DamageWhen an asset is damaged or destroyed it may count as a disposal (sale), or part-disposal, for capital gains tax (CGT) purposes. This applies only to assets chargeable to CGT. So, for example, it won't usually apply to machinery...
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  • Tax - Option for special method of cost apportionment
    Option for special method of cost apportionmentIf you sell a piece of land which is part of a larger estate, a little known concession could save you some tax.General ruleThe general rule for any part disposal of an asset is that the amount of the original cost attributable to the part sold is determined by the following formula: Where:A = the proceeds received for the part disposed; andB = the market value of the unsold part.In most cases, this general rule will produce a result that is logical; however, in...
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  • Tax - Claim for private residence relief to apply to a former home
    Claim for private residence relief to apply to a former homeWhen a marriage fails, tax planning is vital and sometimes urgent or avoidable tax liabilities can arise. An example of this is capital gains tax and the matrimonial home. Where one spouse (or civil partner) moves out and transfers their interest to the other as part of the financial settlement, private residence relief can be lost.  Use our letter to make an election to treat your former home as your main residence from the date of separation to the...
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  • Tax - Claim to adjust base cost for part disposal of land
    Claim to adjust base cost for part disposal of landWhen selling a small part of a piece of land you are still liable for capital gains tax (CGT). However, if conditions are met, you can make a claim under s.242 Taxation of Chargeable Gains Act 1992 to deduct the sale proceeds from the base cost of the land instead of treating it as a sale of CGT purposes.Disposing of landLand is a chargeable asset for CGT purposes which means when you sell or transfer it, you need to calculate if you've made a gain or a loss....
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  • Tax - Company shares or securities reorganisation clearance letter
    Company shares or securities reorganisation clearance letterWhere a company acquires 25% or more of the shares in another, or reorganises its share capital, it can ask for confirmation (clearance under s.138 Taxation of Chargeable Gains Act 1992) that the transaction will not count as a chargeable event for capital gains tax purposes.How to applyAn application for clearance must be submitted to HMRC's specialist clearance office in advance of the proposed transaction. A copy of the letter should be sent to the...
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