Mason made the following disposals in 2021-22: 1. 20 September 2021: sold a painting to his...

 

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Mason made the following disposals in 2021-22: 1. 20 September 2021: sold a painting to his brother, Peter, for £25,000 despite it being worth £30,000. He had inherited the painting from his aunt in January 1998 when it was worth £50,000. 2. 30 November 2021: sold a decorative bowl at auction for £11,250 less auction costs and VAT of 18%. He had bought the bowl at a car boot sale for £15. 3. 5 February 2022: sold a 14% shareholding in Blooks Ltd, an unquoted trading company, to his other brother John for £35,000. At that date the shares were worth £65,000. He had acquired the shares in August 2005 for £10,400. Mason has worked for Blooks Ltd for three years. 4. 21 February 2022: sold an antique car for £49,000 which he had bought in June 2000 for £35,000. 5. 1 April 2022: a gift to his wife, Joanne, a necklace which he had also inherited from his aunt. It was worth £10,000 when he inherited it in 1998 and is worth £22,000 when gifted to Joanne. Mason had employment income of £50,000 in 2021-22. Requirement Calculate the after tax cash available to Mason from his disposals in 2021-22 after taking account of any allowances and claims or elections that can be made. (18 marks) Mason made the following disposals in 2021-22: 1. 20 September 2021: sold a painting to his brother, Peter, for £25,000 despite it being worth £30,000. He had inherited the painting from his aunt in January 1998 when it was worth £50,000. 2. 30 November 2021: sold a decorative bowl at auction for £11,250 less auction costs and VAT of 18%. He had bought the bowl at a car boot sale for £15. 3. 5 February 2022: sold a 14% shareholding in Blooks Ltd, an unquoted trading company, to his other brother John for £35,000. At that date the shares were worth £65,000. He had acquired the shares in August 2005 for £10,400. Mason has worked for Blooks Ltd for three years. 4. 21 February 2022: sold an antique car for £49,000 which he had bought in June 2000 for £35,000. 5. 1 April 2022: a gift to his wife, Joanne, a necklace which he had also inherited from his aunt. It was worth £10,000 when he inherited it in 1998 and is worth £22,000 when gifted to Joanne. Mason had employment income of £50,000 in 2021-22. Requirement Calculate the after tax cash available to Mason from his disposals in 2021-22 after taking account of any allowances and claims or elections that can be made. (18 marks)

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Answer Masons aftertax cash available from disposals in 202122 is 109937 Calculation 1 Disposal of painting Gain on sale 25000 50000 25000 CGT allowan... View the full answer