Paolo started his own, and only, business as a sole trader in 2000 and has decided to sell it to Leo in the tax year 2020/21. He realised following gains/(losses) Factory Goodwill Warehouse E £255,000 £130,000 (£75,000) Investment property (currently let) All the assets have been held by Paolo for many years. He has no other gains or losses in the tax year 2020/21 but has capital losses brought forward of £13,000. His only other income for the year is trading profit of £35,000 £170,000 Required: Calculate the amount of CGT payable by Paolo on the sale of his business claiming all relevant reliefs.

Paolo started his own, and only, business as a sole trader in 2000 and has decided to sell it to Leo in the tax year 2020/21. He realised following gains/(losses) Factory Goodwill Warehouse E £255,000 £130,000 (£75,000) Investment property (currently let) All the assets have been held by Paolo for many years. He has no other gains or losses in the tax year 2020/21 but has capital losses brought forward of £13,000. His only other income for the year is trading profit of £35,000 £170,000 Required: Calculate the amount of CGT payable by Paolo on the sale of his business claiming all relevant reliefs.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Noah Yobs, who has $75,400 of AGI (solely from wages) before considering rental activities, has $67,860 of losses from a real estate rental activity in which he actively participates. He also actively participates in another real estate rental activity from which he has $37,700 of income. He has other passive activity income of $24,128.a. What amount of rental loss can Noah use to offset active or portfolio income in the current year?$b. Complete Noah's Form 1040 (page 1) for the current year. Use the minus sign to indicate a loss.
Josh has investments in two activities, these are his only two investments. Josh materially participates in Activity A (acquired three years ago). Activity A has $10.000 basis at the beginning of the year and produces a loss of $30,000 this year. Activity B is a passive activity for Josh. Activity B (acquired two years ago) has an $80,000 basis at the beginning of the year and produces a loss of $50,000. Neither activity is a publicly traded partnership. Josh has $100,000 of wage income. What is the total amount of Josh's suspended losses for the year? (enter whole dollars only, no minus sign (-) no dollar signs ($). no commas (.), or any other marks.)
Noah Yobs, who has $97,000 of AGI (solely from wages) before considering rental activities, has $87,300 of losses from a real estate rental activity in which he actively participates. He also actively participates in another real estate rental activity from which he has $48,500 of income. He has other passive activity income of $31,040. a. What amount of rental loss can Noah use to offset active or portfolio income in the current year? b. Compute Noah’s AGI on Form 1040 [pages 1 and 2; also complete Schedule 1 (Form 1040)] for the current year. Use the minus sign to indicate a loss. What amounts should go on lines 1, 6, & 7 on page 2 of FORM 1040? What amount s go on lines 17, & 22 on schedule one of FORM 1040?
Christ owns a factory building that he has used in his business for many years. On 1/28/20, the factory was totally destroyed in a fire. Christ received $ 5,000,000 from his insurance company for this total loss. At the time of this loss, Christ had an adjusted basis in this factory of $ 2,000,000 ($ 3,000,000 original cost less $ 1,000,000 in accumulated straight-line tax depreciation). Christ replaced the factory at a cost of $ 4,800,000 in November of 2020. Calculate Christ’s 2020 realized gain of loss from the above How much gain or loss will Christ recognize for tax purposes in 2020? How much additional federal tax will Christ incur in 2020 assuming his marginal ordinary income tax rate is 37% and his net capital gain rate is 20%? What is Christ’s tax basis in the replacement factory building?
Sarah operates a printing business in Sydney. On 1 July 2018 she bought a new printing press for $200,000. The press was used 100% for business purposes and has an Effective Life of 8 years. Sarah opted to use the PCM to calculate depreciation. On 5 July 2020, Sarah sold the printing press. Required: Calculate the Balancing Adjustment and discuss the tax consequences if Sarah sold the press for: (a) $200,000 (b) $149,657.53 (c) $100,000
Please do not give solution in image format ?
Helena has the following long-term capital gains and losses for 2019: $94,000 28% gain, $75,200 28% loss, $42,300 25% gain, and $37,600 0%/15%/20% loss. She also has a $47,000 short-term loss and a $84,600 short-term gain. She has no other income. a. What is Helena’s AGI from these transactions? b. If she has a net long-term capital gain, what is its makeup in terms of the alternative tax rates?Helena has a net LTCG of ___________, all of which is 25% gain 37600 net STCG.
lois bought a house in july 2009 for $200000 and moved in immediately. in july 2012, she rented it out as she was sent overseas ny her employer. at that time, the house was valued at $350000. she sold it in july of the current tax year for $360000. Calculate Bunny’s net capital gain/(loss) for the current tax year, indicating where appropriate which element of the cost base is applicable for each outlay. Support your answer with income tax legislation where necessary
Dorothy acquired a 100% interest in two passive activities: Activity A in January 2015 and Activity B in 2016. Through 2018, Activity A was profitable, but it produced losses of $200,000 in 2019 and $100,000 in 2020. Dorothy has passive activity income from Activity B of $20,000 in 2019 and $40,000 in 2020. After offsetting passive activity income, how much of the net losses may she deduct? If an amount is zero, enter "0". In 2019, Dorothy may deduct $ of the net passive activity losses and has $ of passive activity losses suspended. In 2020, Dorothy may deduct $ of the net passive activity losses and has total suspended losses carried forward to 2021 of $.
In 2016 Gabby purchased and placed into service equipmentused in her business as a cost of $ 800,000. Because of newtechnology, this equipment was not useful after a few years, soGabby sold the equipment in 2020 for $ 5,000. At the time of thesale, Gabby had claimed accumulated tax depreciation of $340,000 on this equipment. Assume that Gabby has substantialincome and has a 2020 marginal ordinary income tax rate of37% and a marginal net capital gain rate of 20%, how much taxwill Gabby save due to the loss on the sale of this asset?
Jim, a US individual, purchases a certain rental real estate property in 2014 and leases it out producing a taxable loss of ($10,000) each year from 2014-2017. Jim has no other sources of income during any of these years. Jim sells the real estate in 2017 recognizing only a $30,000 gain on the sale. How much income (loss) does Jim report on his tax return in each of the tax years? If Jim is a real estate professional: 2014 ___________ 2015 ____________ 2016 ____________ If Jim is a not real estate professional: 2014 ___________ 2015 ____________ 2016 ____________
Samuel Jenkins made two investments; the first was 13 months ago and the second was 2 months ago. He just sold both investments and has a capital gain of $10,000 on each. If Samuel is single and has taxable income of $41,250, what will be the amount of capital gains tax on each investment? See Capital Gains table and Taxable income rate table. Investment 1 (held 13 months) Investment 2 (held 2 months) Capital Gains Tax