Pre-Tutorial Question

Tutorial Questions – Week 8

 Pre-Tutorial Question

A company made the following disposals during the year to 31 March 2015:

1. A factory building was sold for £650,000 on 13 June 2014. This building had cost £300,000 in August 2000 and was extended in July 2002 at a cost of £50,000.
2. An office building was sold for £1,000,000 on 15 August 2014 and was immediately replaced by another office building costing £925,000. The building sold in August 2014 had cost £600,000 in February 2002. Rollover relief was claimed on the disposal of this building.
3. A vintage motor car was sold for £80,000 on 12 September 2014. The car had cost £100,000 in June 2010.
4. 8,000 ordinary shares in Exxak plc were sold for £80,000 on 18 December 2014. Shares in Exxak plc had been acquired as follows:

1. Government securities were sold for £40,000 on 17 January 2015. These securities had cost £45,000 in October 2009.

Required:

Compute the chargeable gain or allowable loss arising on each of the above disposals. Compute the chargeable gains figure which should be included in the company’s total taxable profits for the year ended 31 March 2015.

You may use the following RPIs in answering the pre-tutorial question:

Tutorial Question 1

Niles Ltd prepares its accounts to 31 March each year.  For the year ended 31 March 2015 the company had the following income:

On 1 September 2014 the company sold a factory for £300,000.  The estate agents fees relating to disposal were £9,000.  It had originally purchased the factory on 7 October 1994 for £130,000 and spent £2,000 on repainting during the same month