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（d) Explain how Gloria would be taxed in the UK on the dividends paid by Bubble Inc and th

(d) Explain how Gloria would be taxed in the UK on the dividends paid by Bubble Inc and the capital gains tax

and inheritance tax implications of a future disposal of the shares. Clearly state, giving reasons, whether or

not the payment made to Eric is allowable for capital gains tax purposes. (9 marks)

You should assume that the rates and allowances for the tax year 2005/06 apply throughout this question.

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