Online SA and Capital gain tax

Paulbacca

I'm filling in my self assessment online and have a capital gains question.

I sold a trademark and domain name together for £20,000. The online form says a must fill in a separate capital gains worksheet for each asset sold but I sold them together. Should I split the value between the two items or can I list together?

Thanks

Paul

00ec25

why do you think you are liable to CGT rather than Income Tax?

nomunnofun

00ec25 wrote: »

why do you think you are liable to CGT rather than Income Tax?

From my (now fuzzy and getting fuzzier) memory - I believe that they are both liable to CGT unless the op trades in selling domain names or trademarks. When I get time I will see if I can find the specific legislation on this.

00ec25

nomunnofun wrote: »

From my (now fuzzy and getting fuzzier) memory - I believe that they are both liable to CGT unless the op trades in selling domain names or trademarks. When I get time I will see if I can find the specific legislation on this.

your memory is very good, that was the point i was seeking confirmation for from the OP, does he have "business" activities ?

nomunnofun

00ec25 wrote: »

your memory is very good, that was the point i was seeking confirmation for from the OP, does he have "business" activities ?

Aaaah - should have guessed so - my apologies!

Paulbacca

Thanks for replying. I do not trade in domain names. That is not my business. I'm a part time software developer that has sold the domain and trademark that I was using for my software. So essentially these were my assets.

nomunnofun

Paulbacca wrote: »

Thanks for replying. I do not trade in domain names. That is not my business. I'm a part time software developer that has sold the domain and trademark that I was using for my software. So essentially these were my assets.

Fair enough. In that case CGT would appear to be appropriate. If you can identify the separate proceeds and cost each should be shown separately in two computations. In the unlikely event that your gain is less than £10600 you do not even need to declare it.

Paulbacca

Ok. I'll split the payment equally between the two and do two computation worksheets.

Also, do you think I can claim entrepreneurs relief? Though I have not sold my business, I have sold my software brand, and had to rebrand my software.

zygurat789

Paulbacca wrote: »

Ok. I'll split the payment equally between the two and do two computation worksheets.

Also, do you think I can claim entrepreneurs relief? Though I have not sold my business, I have sold my software brand, and had to rebrand my software.

Check here to see if you qualify for entrepreneurs' relief, there's a good chance that you will.

http://www.hmrc.gov.uk/helpsheets/hs275.pdf

You have sols part of your business, that does not mean you cannot claim entrepreneurs' relief.

I would have thought the best way to apportion the sale proceeds was in the ratio of the cost prices.

Paulbacca

Hi zygurat789,

I have read much of the material hmrc has regarding entrepreneurs relief. However, I picked out this part that I think does allow me to claim. My software brand was a distinct part of my business. What do you think?

From Page 3
"Entrepreneurs’ Relief is not available on the disposal of assets of a continuing business unless they are comprised in a disposal of a distinct part of the business."

Your suggestion for apportioning the sales proceeds in proportion to the original purchase price is a good one. This would equate to:

4% for domain name
96% for trademark

Thanks

Paul

zygurat789

Paulbacca wrote: »

Hi zygurat789,

I have read much of the material hmrc has regarding entrepreneurs relief. However, I picked out this part that I think does allow me to claim. My software brand was a distinct part of my business. What do you think?

From Page 3
"Entrepreneurs’ Relief is not available on the disposal of assets of a continuing business unless they are comprised in a disposal of a distinct part of the business."

Your suggestion for apportioning the sales proceeds in proportion to the original purchase price is a good one. This would equate to:

4% for domain name
96% for trademark

Thanks

Paul

Roughly what is the value of the capital gain? Do you have an accountant?

I couldn't possibly comment on an individual case without an interview.

As far as the gain is concerned it makes no overall difference, but given the disparity between the cost prices I would have thought a 50/50 split would have looked a bit more than odd!