This document provides the standard capital gains tax proforma and exceptions to the standard proforma. It also covers the rules on part disposals, transactions involving connected persons and gifts.
A charge to capital gains tax arises when a chargeable person makes a chargeable disposal of a chargeable asset. The disposal may produce a taxable profit (known as a gain) or an allowable loss. These terms are discussed in the Introduction to capital gains tax guidance note.
See Checklist - calculation of capital gains and losses for issues to consider when reporting client gains and losses.
This guidance note covers the general rules used to calculate whether an individual has made a gain or loss on the chargeable disposal of a chargeable asset.
Standard capital gains tax proformaChanges were introduced in FA 2008 to simplify the way in which gains are calculated for non-corporates (ie individuals and trustees) from 2008/09 onwards. The previous rules are not discussed here.
The standard proforma for calculating the chargeable gain on the disposal of chargeable assets from 6 April 2008 onwards is a basic calculation of the cash profit: