74.

Petal Ltd

Petal Ltd - sale of shares

No. of shares Cost Indexed cost
£ £
14 June 2007 acquisition 1,000 3,000 3,000
Indexed cost to July 2011
0.132 x £3,000 396
3,396
17 July 2011 acquisition 3,000 10,000 10,000
4,000 13,000 13,396
Indexed cost to December 2017
0.185 x £13,396 2,478
15,874
19 October 2019 disposal (cost x 3,000/4,000) -3,000 -9,750 -11,906
c/f 1,000 3,250 3,968

Gain
£
Proceeds 21,000
Less indexed cost -11,906
Gain 9,094
75. Roof Ltd

Capital gain on disposal of the office block

£
Net proceeds 477,000
Less : cost -192,000
enhancement expenditure -71,000
Unindexed gain 214,000
Less: indexation on cost
£192,000 x 0.478 (frozen at 12.17) -91,776
Indexation on enhancement
£71,000 x 0.293 (frozen at 12.17) -20,803
101,421
76. Box plc

Box plc - chargeable gains y/e 31.3.2020

Summary of gains
£
Shares: last nine days (W1) 400
Shares: FA 1985 pool (W2) 34,322
34722
Less painting (W3) -2,000
net chargeable gains 32722

Workings
1. Crate plc shares - acquisition on previous nine days
£
Proceeds 2,000/20,000 x £124,000 12,400
Less cost -12,000
Gain 400

Acquisitions matched with disposals under the 9-day rule never enter the FA 1985 pool.

2. Crate plc shares - FA 1985 pool

No. of shares Cost Indexed cost
£ £
26.05.00 13,000 24,000 24,000
Acquisition
24.10.06 IA 0.174 x £24,000 4,176
28,176
Acquisition 5,000 27,500 27,500
c/f 18,000 51,500 55,676
26.05.19
IA £55,676 x 0.388 (frozen to 12.17) 21,602
77,278
Disposal -18,000 -51,500 -77,278
c/f Nil Nil Nil

Gain £
Proceeds 18,000/20,000 x £124,000 111,600
Less cost -51,500
Unindexed gain 60,100
less indexation allowance
£(77,278 - 51,500) -25,778
Indexed gain 34,322

3. Painting
£
Proceeds (deemed) 6,000
Less cost -8,000
Loss -2,000
77. Andsnes Ltd

Capital gains computation

£
Warehouse (W1) 35,305
Plot of land (W2) 40,824
Vase - exempt (proceeds and cost £6,000 or less) 0
Chargeable gains 76,129

Workings
1. Warehouse
£
Proceeds 120,000
Less cost -65,000
55,000
Less indexation allowance £65,000 x 0.303 (frozen at 12.17) -19,695
35,305

Rollover relief is not available as the replacement asset was acquired outside the qualifying period.

2. The plot of land

£
Proceeds 69,000
Less: cost -20,000
expenditure in July 2013 -4,000
45,000
Less indexation allowance
£20,000 x 0.186 (frozen at 12.17) -3,720
£4,000 x 0.114 (frozen at 12.17) -456
40,824
78. Jasmine plc

Jasmine plc - chargeable gain for the year ended 31 December 2019
£
Gain: Proceeds 560,000
Less cost -275,000
285,000
Less indexation allowance
£275,000 x 0.234 (frozen at 12.17) -64,350
220,650
Amount rolled over -180,650
Gain chargeable now £(560,000 - 520,000) 40,000
79. Loss reliefs

a) Year ended 31 March

2020 2021 2022
£ £ £
Trading income 125,000 0 80,000
Interest income 263,000 185,000 24,000
Chargeable gains 60,360 0 3,000
Total profits 448,360 185,000 107,000
Less current period loss relief 0 -185,000 0
448,360 0 107,000
Less carry back loss relief -448,360 0 0
0 0 107,000
Less carry forward loss relief 0 0 -63,640
0 0 43,360
Less qualifying charitable donation 0 0 -30,000
Taxable total profits 0 0 13360
Unrelieved qualifying charitable donations £40,000 £57,000

Loss memorandum
Trading loss £
Loss in y/e 31.03.21 697,000
Less used y/e 31.03.21 -185,000
Less used y/e 31.03.20 -448,360
Less used y/e 31.03.22 -63,640
Loss remaining unrelieved 0

There is no corporation tax liability for either of the first two years.
For the third year, the position is as follows.

Corporation tax £
£13,360 x 19% (assumed rate) 2,538

b) The due date for payment of the corporation tax for the year to 31 March 2022 is 1 January 2023.
Galbraith Ltd is not required to pay its anticipated corporation tax liability in quarterly instalments
because its taxable total profits do noto exceed the profits threshold of £1,500,00

The filing date is 31 March 2023.

80. Laurel Ltd

a) The two factors that will influence a company's choice of loss relief claims are:
i) Timing: loss relief against total profits is quicker than carry forward loss relief.
ii) The extent to which relief for qualigying charitable donations might be lost as current period and carry back relief are befor
these but carry forward relief can be restricted to keep an amount equal to donations in charge.

b) Laurel Ltd - taxable total profits y/ends 31 December 2018,2019 and 2020
Y/e Y/e Y/e
31.12.18 31.12.19 31.12.20
£ £ £
Trading income 44,000 0 95,200
Property business income 9,400 6,600 6,500
Chargeable gains 5,100 0 0
Total profits 58,500 6,600 101,700
Less current period loss relief 0 -6,600 0
Less carry back loss relief -58,500 0
Less carry forward loss relief 0 0 -8,700
0 0 93,000
Less qualifying charitable donations 0 0 -1,200
Taxable total profits 0 0 91,800
Unrelieved qualifying charitable donations 800 1,000

Loss memorandum
Trading loss £
Loss in y/e 31.12.19 73,800
Less used y/e 31.12.19 -6,600
Less used y/e 31.12.18 -58,500
Less used y/e 31.12.20 -8,700
Loss remaining unrelieved 0
Capital loss £
Loss in y/e 31.12.19 7,500
Less used y/e 31.12.20 -6,000
Loss remaining unrelieved 1,500
and carry back relief are before deducting
81. Caution Ltd

Caution Ltd - taxable total profits y/ends 31 March 2017, 2018, 2019 and 2020
Y/e Y/e Y/e Y/e
31.03.17 31.03.18 31.03.19 31.03.20
£ £ £ £
Total profits 105,000 60,000 27,000 16,000
Less : current period loss relief -16,000
carry back loss relief -17,000 -60,000 -27,000
Taxable total profits 88,000 0 0 0

Loss memorandum
£
Loss in y/e 31.03.20 120,000
Less used y/e 31.03.20 -16,000
Loss of y/e 31.03.20 available for 3-year carry back 104,000
Less used y/e 31.03.19 -27,000
77,000
Less used y/e 31.03.18 -60,000
17,000
Less used y/e 31.03.17 -17,000
Loss remaining unrelieved Nil
82. Waddle Ltd

a) Waddle Ltd - taxable profits y/e 31 march 2019 and 31 March 2020
Y/e Y/e
31.03.19 31.03.20
£ £
Trading profit 0 5,300
Property business profit 3,950 4,500
Chargeable gain £(3,2000 - 1,000) 0 2,200
Total profits 3950 12000
Less: current period relief -3,950 0
Less: carried forward relief 0 -10,950
Less: qualifying charitable donation (wasted in y/e 31.03.19) -200 -1,050
Taxable total profits -200 0

b) Loss memorandum
£
Loss in y/e 31.3.19 18,000
Less used y/e 31.3.19 -3,950
Less used y/e 31.3.20 £(12,000 - 1,050) restricted to relieve QCD -10,950
Loss remaining unrelieved at 31.03.20 3,100
83. Alphabetic Ltd

a) The underpayments for the year to 30 September 2019:

Due date Amount Due Underpaid
£ £
14.04.19 200,000 44,000
14.07.19 200,000 44,000
14.10.19 200,000 44,000
14.01.20 200,000 44,000

Interest will run on each of the amounts ofo £44,000 underpaid from the day after the due date until the date of payment, 1 J

b) i) Fixed rate penalties

1. Where the return is up to three months late - £100
2. Where the return is more than three months late - £200
3. Where the return is the third consecutive one to be filed lated the above penalties are increased to £500 and £1,000 respec

ii) Tax geared rate penalties

A tax geared penalty is triggered in addition to the fixed rate penalties if a sreturn is more than six months late.
The penalty is 10% of any tax unpaid 6 months after the return was due if the total delay is up to 12 months.
The penalty is 20% of that tax if the return is over 12 months late.
 until the date of payment, 1 July 2020.

ed to £500 and £1,000 respectively.

ix months late.
o 12 months.
84. Peter Collins

Five differences between sole trader/company

Difference Sole trader Company

Income tax/capital gains
Tax on profits/gains tax Corporation tax on both
31 January following end
of tax year; payments on Nine months after the end of accounting
Due date for tax on account will probably be period; no payments on account for company
profits required which is not large

Profits only taxed on individual when taken

Taxed on profits as they out of the company Dividends - dividend
arise - no further income, first £2,000 of dividends taxable at
Extraction of profits implications when 0% Salary -
from the business extracted employment income
None on company itself
If salary paid, company pays employer's
contributions and individulal has employee's
Classes 2 and 4 payable by contributions deducted No NICs on
National insuracnce individual dividends
Charge to income tax may aarise as taxable
Use of business No further charge; may lbenefits. No restrictions on company's CAs for
assets privately restrict capital allowances private use.
85.Heaters Ltd

Heaters Ltd - corporation tax payment dates for y/e 31 March 2020
Instalment amount £380,000 x 1/4 = £95,000
Amount Due
£
First instalment 95,000 14.10.2019
Second instalment 95,000 14.01.2020
Third instalment 95,000 14.04.2020
Fourth instalment 95,000 14.07.2020
86. Flower plc

Flower plc - corporation tax payments

Corporation tax for the year ended 31 March 2020:
£
Instalment amount £342,000/4 85,500

Payment dates:
14-Oct-19 85,500
14-Jan-20 85,500
14-Apr-20 85,500
14-Jul-20 85,500