ExpertACCA · Question 21 · Chargeable gains for individuals
SCENARIO: Arthur, aged 65, has run GreenMeadows Farm as a sole trader for 30 years. On 1 May 2023, he sold a barn used for storage for £150,000, realizing a gain of £80,000. He immediately reinvested £100,000 into a new combine harvester. On 1 June 2023, he gifted 10,000 unquoted shares in a farming supply company to his daughter, generating a chargeable gain of £40,000. Arthur sadly passed away on 1 December 2023. His estate included the farmhouse, which he occupied for agricultural purposes.
QUESTION: Does the sale of the barn qualify for Business Asset Disposal Relief (BADR)?
SCENARIO: Arthur, aged 65, has run GreenMeadows Farm as a sole trader for 30 years. On 1 May 2023, he sold a barn used for storage for £150,000, realizing a gain of £80,000. He immediately reinvested £100,000 into a new combine harvester. On 1 June 2023, he gifted 10,000 unquoted shares in a farming supply company to his daughter, generating a chargeable gain of £40,000. Arthur sadly passed away on 1 December 2023. His estate included the farmhouse, which he occupied for agricultural purposes.
QUESTION: Does the sale of the barn qualify for Business Asset Disposal Relief (BADR)?
Answer options:
Yes, because he has owned it for more than 2 years
Yes, because it was used in his trade
No, because it is a sale of a single asset, not a disposal of the whole or part of the business
No, because he is over 60 years old
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