Chargeable gains summary

Background

The 'E' schedule forms part of the master schedules present in every computation and provides a summary of all chargeable gains and losses occurring in the period, together with details of any capital losses brought forward, utilised in the period and carried forward. This schedule is a master schedule for computations for Financial Year 1994 and later periods; if it is not used, it will be suppressed from the computation.

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Developing the schedule

This schedule is automatically present in a new period.

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Completing the schedule

Notional transfers

Notional intra-group transfers were introduced by Finance Act 2000 in relation to disposals after 31 March 2000. The FY2001 schedules include additional cells on the 'E' schedule, to deal with the total notional transfers in and out. For FY2000 files affected by the notional intra-group transfer provisions, it is necessary to show on the 'E' schedules of the companies concerned the disposals deemed to take place in those companies, after the notional transfers. Appropriate memorandum notes can be made on the gains schedules to explain the position.

Losses treated as Loan Relationships under SI 1994/3226

This allows a user to remove an amount of capital loss that they wish to treat as a loan relationship debit. The amount should then be manually entered on the loan relationship schedule as a debit and reconciled as an amount credited/ (charged) other than to the P/L.

For FY2001 files in the case of transfers out, there is provision on the right of the 'E' schedule to indicate the particular gain or loss relating to the asset that has been transferred - amounts should be entered in this column with the sign reversed, so that, for example, a gain on a notionally transferred asset is entered as a negative amount. The roll-over relief calculations have been correspondingly adjusted to deal with partial transfers out.

For FY2001 files in the case of transfers in, a new schedule, Notional transfers disposals, can be developed from the 'E' schedule to support the total figure

A new notional transfers matrix in Group module, which is designed to operate with the procedure described in the paragraph above.

(Losses) dealt with under Loan Relationships

Where the an election has been made to treat a loss as dealt with under the loan relationship regime the user can reverse the amount of the loss out of the Chargeable Losses schedule using this cell, and insert a corresponding amount of loss as a loan relationship debit.

Rebasing election

Where a rebasing election is in force the user should amend the flag at the foot of the Chargeable gains summary schedule. This status will carry forward.

All disposals should be entered using the schedules for assets acquired after 31 March 1982; a warning will be generated if any other standard schedule is used.

Pre-entry losses

The foot of the schedule contains a section in which capital losses can be identified before the company joined the group and the 75% chargeable gains group relationship is obtained.

The functionality of this screen section is based on the underlying principle that current period losses will be set off against current period gains for assets held before the company joined the group, prior to the utilisation of any brought forward pre entry losses (TCGA 1992Schedule 7A). However for pre entry assets, certain situations may arise in which a current period gain cannot be set off against a loss of the period but instead against the balance of brought forward losses.

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Standard sub-schedules

Further standard schedules can be developed from the 'E' schedule to calculate the gains on disposals of assets, depending on whether or not the assets were held at 6 April 1965, 31 March 1982, and whether there is a part disposal or not.

The software contains the following screens to calculate the capital gain or loss on disposal. Click the Goto marker to move to the help screen for that schedule:

Assets acquired after 31/03/82 or rebased	Assignment of short lease
Assets held on 31/03/82	Grant of lease from non wasting interest
Part disposal- assets acquired after 31/03/82 or rebased	Grant of lease from wasting interest
Part disposal- assets held on 31/03/82	Connected party disposals
Share pool	Roll-over relief
Pre 1965 asset disposal	Multiple gains
Pre 1965 asset- development land	Double tax relief on gains
Pre 1965 part disposal

Non-standard schedules

For disposals of assets which do not conform to the standard pack of schedules, the user should develop non-standard schedules from the Chargeable gains summary schedule for their own calculations.

Such schedules must be manually referenced through to the Chargeable gains summary schedule and, where applicable, to the Roll-over relief schedule.

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Carry forward

On building a new period, the capital losses and pre-entry losses carried forward are automatically entered on the capital gains summary schedule as brought forward figures in the subsequent computation.

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Related errors

Error	How to solve it
Proceeds reinvested cannot exceed total proceeds	Proceeds from the sale of an asset that are reinvested in a new asset qualify for rollover relief and defer the chargeable gain on the asset. The figure that is reinvested cannot exceed the proceeds from the sale of the asset.
Can only rollover gains remove reinvestment figure	The gain on the sale of an asset may be reinvested in the cost of the new asset, thus deferring the gain. Any reinvestment made must be entered as a positive number.
Capital losses c/f are positive	This error results from the sign conventions used within the software.This error can be resolved by clicking the button.
Capital losses b/f are positive	This error results from the sign conventions used within the software.This error can be resolved by clicking the button.
Enter reinvestment as a positive number on this schedule	The gain on the sale of an asset may be reinvested in the cost of the new asset, thus deferring the gain. Any reinvestment made must be entered as a positive number.

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