Please forgive the basic question, as many of you know I have been on maternity leave and the old brain isn't what it used to be. And this is the first time I have come across this scenario in practice.
If someone could confirm the following is correct, I would be most grateful! Or if I have officially lost the plot, I'd love to know the right answer.
Client disposed of a motor vehicle asset for more than the purchase price (yes, I know, unusual!).
- The gain on disposal goes to the P&L and is added back in the tax comp.
- The purchase price only is added back to the capital allowances pool
- The excess is noted in the chargeable gains section of the CT600, box 16. Gain is indexed (that took me back a few years!). I'm using Taxfiler so it takes me through the whole disposal process.
Thanks so much and Merry Christmas.