ACCA Applied Skills · Taxation (UK) · The computation of capital gains tax
Priya sold a painting in November 2025 for £48,000, paying auctioneer's fees of £2,000 on the sale. She had bought it in 2019 for £30,000 and paid £1,000 legal fees on acquisition. What is her chargeable gain before the annual exempt amount?
The chargeable gain is £15,000. Disposal proceeds of £48,000 are reduced by £2,000 selling costs, and the cost of £30,000 is increased by £1,000 acquisition fees. Net proceeds of £46,000 less cost of £31,000 gives £15,000.
- A£15,000Correct
- B£17,000
- C£18,000
- D£16,000
Explanation
Net proceeds are £48,000 less £2,000 selling costs = £46,000. Allowable cost is £30,000 + £1,000 = £31,000. Gain = £46,000 - £31,000 = £15,000. £16,000 ignores one of the incidental costs, and £18,000 ignores both.
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