1. Advise Leicester Ltd on how it can reduce its corporation tax liability by claiming rollover relief,...
Question:
1. Advise Leicester Ltd on how it can reduce its corporation tax liability by claiming rollover relief, outlining the conditions that apply, any time limits that should be adhered to, and the consequences of making a claim.
Leicester Ltd received interest on £15,000 12% Treasury stock 2025. The interest is paid six-monthly on 31 December and 30 June each year.
Property income receivable for the 16 month period was £24,800 and accrued evenly over the period.
On 18 September 2019 Leicester Ltd disposed of a storage building for £283,000. It had purchased the storage building on 6 April 1992 for £56,000, and on 17 March 2008 spent £42,400 extending the building to create more storage room.
Legal and professional fees of £2,670 were paid in relation to the purchase and legal and professional fees of £4,950 were paid in relation to the sale.
Leicester Ltd had always used the storage building for the purposes of its trade.
A donation of £2,175 was made on 31 October 2018 to the National Trust, a registered UK charity.
At 1 June 2018 Leicester Ltd had £60,675 trading losses brought forward, and unused capital losses of £2,920.
Leicester Ltd has not received any dividends and is not part of a group of companies.
Introduction to Corporate Finance What Companies Do
ISBN: 978-1111222284
3rd edition
Authors: John Graham, Scott Smart