he plans to acquire a retireme on, he made a number of dis 21/22. uld be exempt or wholly relie
he plans to acquire a retireme on, he made a number of dis 21/22. uld be exempt or wholly relie
Chapter16: Tax Research
Section: Chapter Questions
Problem 66LC
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Transcribed Image Text:Peder Prescott is 58 years old and is employed as a corporate tax planning adviser by
Senators LLP. Peder is married to Kyler Prescott; Kyler is an investment analyst at
Redwings plc, a large investment bank.
Peder owns an investment portfolio of tangible and intangible assets.
Peder intends to retire in the near future; he plans to acquire a retirement home in
Toulon (France). To finance this acquisition, he made a number of disposals from his
investment portfolio during the tax year 2021/22.
Which TWO of the following disposals would be exempt or wholly relieved from capital
gains tax in 2021/22?
A. Sale of qualifying corporate bonds issued by Flames plc, an engineering company
that operates in the North Sea oil and gas sector
B. Sale of an oil painting to Kyler Prescott. The oil painting had a market value on
disposal of £138,000, but Peder sold it to Kyler for a total consideration of £7,000.
The painting cost £62,000 when acquired by Peder on 9 June 2001
C. Sale of Peder's principal private residence (i.e. his main residence), a house in
London (UK). Peder acquired the house in 1998
D. Part disposal of 400 shares in Jaguars Ic., a company that is resident in Miami
(USA). The shares were acquired in two acquisitions of £170,000 for 582 shares on
11 November1996 and £262,000 for 403 shares on 20 January 2003, respectively.
The net disposal consideration of this part disposal was £608,000
6.
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