During 2020, Amelia Burke made the following four disposals: 2,200 shares in InvestCo plc for 8,000. Amelia
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Question:
During 2020, Amelia Burke made the following four disposals:
- 2,200 shares in InvestCo plc for €8,000. Amelia previously sold 300 shares in InvestCo plc on 1 March 2017 for €1,200. The shares were acquired as follows:
Date of Transaction | Nature of Transaction | Number of Shares | Cost per Share |
30 June 2001 | Purchase | 2,000 | € 1.80 |
5 May 2011 | Rights issue | 1:4* | € 0.60 |
*1 new share for every 4 shares held
- A set of antique watercolour paintings for €2,000;
- A commercial investment property in Spain for €50,000. The investment property was acquired for €15,000 in June 1990, and renovation works were carried out in 2014 at a cost of €10,000;
- A four-acre site to her daughter, Kate, for €75,000. The site has a market value of €250,000 and a current use value of €75,000. The site was acquired in January 2002 for €125,000 when the current use value was €25,000. Enhancement expenditure of €5,000 was incurred in 2015.
- Amelia incurred an allowable capital loss of €25,000 on the disposal of shares in 2019 and this loss has not yet been set against any chargeable gains.
Subject: Irish Taxation
Required:
- Calculate the capital gain, if any, in relation to each of the FIVE disposals made by Amelia during 2020, explaining your treatment of each disposal;
- Calculate Amelia’s total Capital Gains Tax liability for 2020, assuming that these are the only disposals made during the year;
- Advise Amelia on the due date for payment for the liability calculated above, assuming all disposals are made before 30 November 2020.
Related Book For
Accounting Principles
ISBN: 978-1118875056
12th edition
Authors: Jerry Weygandt, Paul Kimmel, Donald Kieso
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