chiyu

Hi, according to HMRC rule on CGT about using market value for assets bought before Apr 1982, does it apply to listed shares? That means, should I use market value of listed shares on 31 Mar 1982 instead of their real purchase cost for the calculation of gain or loss subject to GCT? Thank you very much for your attention!

Thank you very much! If I change the above case a bit by replacing the wages with interest income i.e. Interest income: 50,200 Dividend income: 10,000 Total : 60,200 Less: personal allowance: -12570 Subtotal: 47,630 Less: Starting rate for savings -5000 (since other income i.e. dividend income is less than 12,570, entitle to full amount) Less: Personal Savings Allowance -500 (since gross income 60,200 fall under higher rate tax band, only entitle to 500) Total: 42,130 Tax taxable: Interest: (50,200-12,570-5000-500 = £32,130) *20% Dividend: (10,000-500) = £9,500 of which £5,570 taxed at 8.75% and £3,930 taxed at 33.75% Could you please advise whether my understanding above is correct or not?

Hello, Could you please help to clarify whether my understanding in the below case for year 2023/24 is correct or not? Wages: 50,200 Dividend income: 10,000 Total : 60,200 Less: personal allowance: -12570 Subtotal: 47,630 Tax taxable: Wages: (50,200-12,570 = £37,630) *20% Dividend: (10,000-500) = £9,500 of which £70 taxed at 8.75% and £9,430 taxed at 33.75% Many thanks

Thank you very much for your reply. Could you please further clarify the following: 1) after deducting the personal saving allowance 500, the remaining 33,240 will be subject to 20% tax, am I correct? 2) you mentioned above that my total income crosses into the higher rate, could you please advise which figure is used to determine my tax band, the total income before any allowance 51,310 or the one after personal allowance 38,740? Thank you very much for your time

Thanks for your reply. However, I am very sorry that I don't understand what element of my query is so personal or sensitive that can't be clarified here through the forum. Please feel free to ask for any additional information that may help you to understand my case. Besides, I don't think webchat works for me as it's handled by AI and hence not as flexible as this forum and I prefer asking this kind of tax question by writing. Hope you can understand and spare some time to give me your valuable advice. Many thanks.

Thank you very much for your prompt reply. However, a) I don't understand how to derive the amount of dividend income taxed under basic rate (i.e. £8530), could you please advise; b) is that correct in the above example that the starting rate for savings available is 24,600? c) what is the amount of Personal Savings Allowance available 500 or 1000? Which income amount is used to determine the tax band?

Hi, I have a follow-up question on the above example. If the example above is modified as below: Taxable income excluding interest : 100 Interest income: 51,300 Total taxable income including interest : 51,310 Deduct: personal allowance -12,570 Subtotal: 38,740 Deduct: starting rate for savings: -5000 Subtotal: 33,740 Deduct: personal savings allowance: 500/1000?? Should I deduct the starting rate for savings before determining the tax band? What should be my tax band? basic or higher? Thank you.

Sorry, I am still a bit confused with the rule of opening and transferring an ISA within the same tax year. Could you please help to advise: Case 1: If I opened & contributed 20,000 into a fixed rate 1-year ISA during tax year 24/25 in which the bank will transfer the principal and interest into a cash ISA at the end of the term. Is such a transfer from fixed rate ISA to cash ISA constitute an opening of a new accounts and has automatically wholly used up my allowance in year 25/26? Case 2: If I opened & contributed 20,000 into a fixed rate 2-year ISA during tax year 24/25, in 25/26 can I open a new cash or fixed rate ISA accounts as no fresh fund will be deposited into this old ISA during the year? In tax year 25/26, is interest earned on this old 2-year fixed rate ISA still tax free?

Could you please help to advise the following hypothetical case (all numbers are in GBP): For tax year 2024/2025, my income is solely interest (41,240) and dividend (13,500). Below are my calculation of taxable dividend and interest income: 1) dividend income (13500) (i) less dividend allowance (500) = taxable dividend 13000 (ii) 2) interest income (41,240) less personal allowance (12570) = 28,670 (iii) 3) 28,670 less Starting rate for savings which is reduced as dividend exceed 12570 (5000 - (13500-12570) = 4070) = 24600 (iv) 4) 24600 less Personal Savings Allowance (500) = taxable interest (24100) (v) My questions are (a) am I correct to apply the personal allowance (12570) to my interest income before dividend income? (b) which figures (i)+(iii) or (ii)+(iii) or (i)+(iv) or (ii)+(iv) or (i)+(v) or (ii)+(v) is used to determine the income tax band which in turns affect the amount of Personal Savings Allowance (500 or 1000) available under step (4)? For most of the cases, I fall under higher rate tax band and only get 500 of Personal Savings Allowance but eventually, my taxable interest income will only subject to 20% tax as it's less than 37,700 ie. basic rate. (c) similarly, which figures (i)+(iii) or (ii)+(iii) or (i)+(iv) or (ii)+(iv) or (i)+(v) or (ii)+(v) is used to determine the income tax band which in turns affect the tax rate of dividend income ie. 8.75% or 33.75%