I have capital losses from previous years. This year I have a capital gain that is subject to business assett taper relief.
Can I set off the gain against my losses, having allowed for taper relief, or must I set off the gain excluding taper relief?
Richard Fletcher
Replies (3)
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Put some figures on it....
.......
Suppose you have losses brought forward of £100,000 and capital gains in the year (which attract full businesss taper) of £50,000.
You utilise sufficient losses to bring the gross gains down to the Annual Exemption (£8,500 this year).
So you utilise £41,500 of your losses leaving £58,500 to carry forward.
The gains of £8,500 attract 75% taper leaving only £2,125 to be covered by the exemption. The balance of the exemption of £6,375 is lost.
Look at the CGT pages of the return
These make it clear that
where
G is Chargeable Gain
L is allowable losses
TR is the taper rate i.e. (100-Taper Relief)
Tapered gain = (G-L)*TR