I need to declare the capital distribution from a limited company following a Members Voluntary Liquidation (MVL) which was completed in Oct 2023. During the liquidation process, the company made two capital distributions
Distribution 1 in Jan 2023 (to be reported in the tax return for 22/23)
Distribution 2 in May 2023 (will be reported in the tax return for 23/24)
I will be claiming Business Asset Disposal Relief on both distributions (and they are within the allowance).
My questions are as follows:
1. I am using the Capital Gains Worksheet however I am unsure how to answer the question "Type of asset". The following options are available:
a. Listed shares and other securities
b. Unlisted shares and other securities
c. Other Property, assets and gains
d. Residential property and carried interest
Can someone please confirm which option I should select? I assume b or c, but would be grateful if someone can confirm.
2. My understanding is capital distributions should be reported as part disposals. I have 2 questions on this:
a. Where in the SA do I inform HMRC that the capital distribution being reported is a part disposal (I don't see any questions which asks this information).
b. Disposal vs part disposal. I'll be claiming BAD relief so tax is 10% on proceeds after allowance. Does this tax relief/rate differ is its a part disposal?