Tx notes fa22 Final

 
Example 3
 
 
YR Ltd bought land for use in the business in April 1997 for £200,000. The land was sold for 
£350,000 in May 2016. In March 2017 YR Ltd bought fixed plant for use in the business, costing 
£390,000.
YR Ltd sold the fixed plant in February 2023. (YR Ltd has a 31 March year end)
Calculate the chargeable gains as far as the above information allows for y/e 31 March 2017 
and y/e 31 March 2023 
Assume indexation factors as follows:
April 1997 to December 2017
0.812
April 1997 to May 2016
0.361
March 2017 to December 2017
0.171
 
(c)
When the replacement asset is a depreciating asset, the gain is deferred as in (b) above. 
However, if a non-depreciating asset is purchased before the deferred gain crystallises, the 
original gain may be rolled over against the cost of the new, non-depreciating asset and will 
only crystallise on sale of the non-depreciating asset.
You may now attempt Practice Question 23



---

158
Only on 
OpenTuition
you can find: Free ACCA notes 
•
Free ACCA lectures 
•
Free ACCA tests 
•
Free ACCA tutor support 
•
The largest ACCA community
June 2023 to March 2024 exams
Watch free ACCA TX lectures

---

159
Only on 
OpenTuition
you can find: Free ACCA notes 
•
Free ACCA lectures 
•
Free ACCA tests 
•
Free ACCA tutor support 
•
The largest ACCA community
June 2023 to March 2024 exams
Watch free ACCA TX lectures
Chapter 22
CORPORATION TAX – GROUPS 
1. Introduction 
A group exists for taxation purposes where one company is a subsidiary of another. The various 
reliefs and rules are only applicable to members of certain group structures.
There are two types of group structure, based on the level of share ownership that are relevant for 
tax purposes, 51% groups and 75% groups.
(1)
51% groups issues:
‣
related 51% group companies
‣
Group VAT registration (see Chapter 25)
‣
Availability of AIA