(b) Prepare a reasoned explanation of how any capital gains tax arising in the UK on the s

Question

(b) Prepare a reasoned explanation of how any capital gains tax arising in the UK on the sale of the paintings

can be minimised. (2 marks)

Answer 1

正确答案：
(b) Minimising capital gains tax on the sale of the paintings
Galileo will become resident and ordinarily resident from the date he arrives in the UK as he intends to stay for more than
three years. Prior to that date he will be neither resident nor ordinarily resident such that he will not be subject to UK capital
gains tax.
Galileo should sell the paintings before he leaves Astronomeria; this will avoid UK capital gains tax completely.
Tutorial note
The gains would be taxable on the remittance basis if the paintings were sold after Galileo’s arrival in the UK. However, this
would not help Galileo to minimise the capital gains tax due as he needs to bring the sales proceeds into the UK in order
to purchase a house.