Taxation of capital gains for individuals and companies

In general terms a capital gain will arise when a person (individual trust or company) disposes of a capital asset at a profit. The disposal (sale gift destruction) of a chargeable asset will give rise to a capital gain or a capital loss. Most property other than cash (sterling) is an asset for capital gains tax. An asset is a chargeable asset if it is not specifically exempt under the capital gains tax legislation. Examples of chargeable assets are land and buildings shares and antiques.

Examples of exempt assets are chattels costing less than £6 000 – tangible moveable assets such as a painting – if the disposal proceeds are also less than £6 000. If consideration exceeds that amount the gain is limited to five-thirds of the excess. A wasting asset – one that has a predictable life of 50 years or less (TCGA...