Karen bought a house in 1994 for £42,000. In November 1995 she spent £18,000 on dividing the house into two self-contained flats. In September 2019 she sold one of the flats for £95,000, at which time the other flat was valued at £105,000. In January 2022 she sold the second flat for £110,000. Karen never lived in either of the flats.

Compute the chargeable gains arising on Karen's two disposals, ignoring incidental costs of acquisition and disposal.

Answer rating: 100% (QA)

To find out chargeable gains we will compute the value of the assets at the time of purchase and compare it with the value at the time of sale of the asset ... View the full answer