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Claude is 55 years old and lives in Norfolk. He has been an employee of Interior Decor plc for several years. During the tax year 2020/21 his gross annual salary was 65,000 with 9,200 paid under PAYE. The following items relate to his employment with the company for the tax year 2020/21: In October 2020, the company required Claude to relocate from its Manchester office where he was working, to Norwich. The company paid relocation costs of 8,500. On 1 December 2020, he received an interest free company loan of 15,000 which he used to buy a car for his wife. None of this has been repaid. During the period 6 April 2020 to 5 January 2021, the company provided him with a car. The car had a list price of 34,000 and an emission percentage of 22%. Fuel for both business and private journeys was paid for by Interior Decor plc. The company runs a nursery and provided nursery care for Claudes daughter, at a cost of 4,100. The company also provided Claude with a mobile phone (costing 640), medical insurance costing 730 and meals in the staff canteen at a cost to the business of 450. The nursery and canteen benefits are available to all staff. On 1 November Claude bought a cottage on the Norfolk coast which he intends to use on his retirement. It was let to the same tenant for 800 per month from 5 November 2020. Costs associated with the property during the tax year were: Advertising for a tenant November 2020 200 Redecoration costs in March 2021 640 Purchase of a washing machine for the cottage January 2021. No machine had previously been provided. 480 Annual insurance cost 1,200 During 2020/21, Claude had dividend income of 6,800 and bank interest of 1,700. He paid 400 to a charity under an HMRC approved scheme. 2 NBS 5923B / 6903B Module contact: Loretta Bond Copyright of the University of East Anglia Version 2

Required: a) Calculate Claudes income tax payable for 2020/21. Note: In your answer you should indicate using zero (0) any items which are not taxable.

Claude made the following disposals of assets during 2020/21: i. He sold his motor car for 2,780. It had originally cost him 8,000 in 2018. ii. He sold a painting (cost 11,000) for 9,800. iii. Claude sold 2,500 shares from his holding of shares in Micron plc, for 28,200. He had originally bought 2000 shares for 4,000 in 2018, and then purchased another 6,000 shares for 22,500 in 2019. iv. Claude gave a painting (market value 12,000) to his wife, Karen. The painting had cost 7,400. v. He sold an antique chair at auction for 5,900. It had cost him 2,100.

Required: b) Calculate Claudes capital gains tax liability for 2020/21. Explain your treatment of any items not giving rise to a chargeable gain or loss.

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