Your client Mr.Jack meet your associate through meeting .

The below are extracts prepared by your associate on basis of meeting ; Mr.Jack had always lived in the UK until, on 6 April 2016, he sold his home in the UK and moved to the country of Medora with his wife, Dana, and their daughter. They always planned to return to the UK at some point, such that they continued to be domiciled in the UK. Mr.Jack began working for a company in Medora on 1 May 2016. In March 2019, Mr.Jacks sister, Florence, became seriously ill. Consequently, Mr.Jack and his family returned to live in the UK on 6 April 2019. Period from 6 April 2016 to 5 April 2019 Mr.Jack was not resident in the UK during this period. However, he visited the UK (staying in hotels) as follows: Tax year Days in the UK 2016/17 49 2017/18 105 2018/19 74 Since 6 April 2019 On 1 June 2019, Mr.Jack and Dana purchased a new home in the UK. On the same date, Dana started a new Full time job in the UK and became UK resident. Mr.Jack and Dana have retained their home in Medora because Mr.Jack has continued working there and does not work in the UK. It is envisaged that Mr.Jack will have been in the UK for 115 days in the tax year 2019/20. Disposals of assets in the tax year 2018/19 On 1 December 2018, Mr.Jack sold a statue situated in the garden of his home in Medora. He had purchased the statue for 17,000 on 1 September 2016. The sale resulted in a capital loss of 7,400. On 1 February 2019, as a result of a commercial takeover, Mr.Jack received 4,000 shares in TW plc (a holding of less than 1%) and 12,000 in cash in exchange for 2,000 shares in SQ plc. One share in TW plc was worth 350 on that day. Mr.Jack had purchased his 2,000 shares in SQ plc (a holding of less than 1%) for 13,500 on 1 June 2013. SQ plc and TW plc are quoted companies. Disposals of assets in the tax year 2019/20 On 1 August 2019, Mr.Jack sold a house situated in Medora. This house was purchased on 1 July 2015 and has always been rented out. The sale realised a gain of 33,900. On 1 December 2019, Mr.Jack gave his sister, Florence, 700 of the 4,000 shares he owned in TW plc. One share in TW plc was worth 450 on that day. Paintings owned by Mr.Jacks mother Mr.Jack has asked for advice on the inheritance tax (IHT) advantages of his mother, Emer, who is UK domiciled, making lifetime gifts to Mr.Jack of either or both of the following paintings. Current Anticipated market value change in value Watercolour 41,000 Falling in value Portrait 37,000 Increasing in value Income tax refund A few months ago, Mr.Jack received a refund of income tax from HM Revenue and Customs (HMRC) in respect of the tax year 2015/16. He has not been able to determine why the refund was made. Tge email from your assistant consists the fallowing Taxation in the country of Medora There is no capital gains tax (CGT). There is no double tax treaty between the UK and Medora. Please prepare a memorandum for the client file consisting of the work set out below: (a) Mr.Jacks UK residence status for the tax year 2019/20 Explain how Mr.Jacks UK residence status for the tax year 2019/20 will be determined and conclude on his likely residence status for that year. Mr.Jack will have lived in both of his houses (i.e. in the UK and Medora) during the year, such that he will not have his only home in the UK for the purposes of the automatic UK residency tests. State how becoming UK resident would affect Mr.Jacks liability to UK income tax. (b) Mr.Jacks disposals of assets in the tax years 2018/19 and 2019/20 For this part of the work, you should assume Mr.Jack is UK resident for the tax year 2019/20 and will receive taxable income in that year of 38,400, before deduction of his personal allowance. Explain how each of Mr.Jacks disposals in the tax year 2018/19 will be treated for the purposes of CGT. Calculate Mr.Jacks CGT liability for the tax year 2019/20. (c) Lifetime gifts of paintings by Emer Explain, with respect to the amount of inheritance tax (IHT) payable ONLY, whether or not it would be beneficial for Emer to make a lifetime gift of either or both of her paintings (as opposed to retaining them until her death). There is no need to address the annual exemption, as Emer makes use of this every year. You should assume there will be no nil rate band available regardless of when thepro transfer takes place. (d) Refund of income tax In respect of the income tax refund, set out the actions which our firm should take and the matters which should be brought to Mr.Jacks attention. Calculate chargeable capital gains on gift of 700 shares in Tw plc as per provisions of UK TAX LAWS F.A 2019?