In this section:

Introduction to Capital Gains Tax
Is your asset liable to Capital Gains Tax?
Gifts, inheritance, divorce - is Capital Gains Tax due?

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Is your asset liable to Capital Gains Tax?

Is your asset liable to Capital Gains Tax?

Most assets are liable to Capital Gains Tax when you sell or dispose of them. This includes shares, property, business assets and personal possessions - whether they're in the UK or overseas. But some assets are exempt – such as your car and, in most cases, your main home.

On this page:

Exempt assets - when you don’t pay Capital Gains Tax
Assets liable to Capital Gains Tax
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Exempt assets - when you don't pay Capital Gains Tax

Some assets aren't liable to Capital Gains Tax at all because they’re exempt. These include:

your car
personal possessions worth up to £6,000 each, such as jewellery, paintings or antiques
stocks and shares you hold in tax-free investment savings accounts, such as ISAs and PEPs
UK government or ‘gilt-edged’ securities eg National Savings Certificates, Premium Bonds and loan stock issued by the Treasury
betting, lottery or pools winnings
personal injury compensation
any foreign currency held for your own or your family’s personal use outside the UK (eg if you've made a gain because of a change to the exchange rate)

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Assets liable to Capital Gains Tax

Most assets - other than those covered above - are liable to Capital Gains Tax when you sell or dispose of them.

This section lists some of these assets, but also outlines situations when you may not need to pay Capital Gains Tax, even though the asset is usually liable.

As a general rule, if you usually pay Income Tax on the gain or profit you make from your line of work - for example, if you're trading as a property dealer, jewellery maker or antiques dealer - you won't have to pay Capital Gains Tax on the gain too.

If you're unsure whether you should be paying Income Tax or Capital Gains Tax, please contact your Tax Office.

Find your Tax Office

Property - including land, buildings and leases

Most property is liable to Capital Gains Tax, which means you must work out the gain or loss if you sell or dispose of it.

Types of property liable to Capital Gains Tax include:

a rented property that you've never lived in or a second home
business premises, such as a shop or a farm
land, such as agricultural land

However, if you sell your main home - even though the asset is liable to Capital Gains Tax - you may qualify for Private Residence Relief. This may mean there's no tax to pay.

See more about Private Residence Relief on your main home

Find out more about Capital Gains Tax and property

Shares, unit trusts and other investments

Disposals of shares, units in a unit trust and similar investments are liable to Capital Gains Tax. This means you must work out the gain or loss if you sell or dispose of them.

Investments liable to Capital Gains Tax when you sell or dispose of them include:

stocks and shares in a company
units in a unit trust
debentures, bonds (but not premium bonds) and certain securities - these are generally investments in or loans to a company or to the government

However, if you no longer own your shares because they’ve been replaced by new shares following a company reorganisation or take-over, there may be no tax to pay.

And if you still own shares but they’ve become worthless, or worth next to nothing, you may be able to claim a loss.

More about Capital Gains Tax and shares

What to do if you’ve made a loss

Antiques, jewellery and other personal possessions

Most personal possessions worth more than £6,000 - either individually or when looking at a collection or set as a whole - are liable to Capital Gains Tax. This means you must work out the gain if you sell or dispose of them.

Personal possessions liable to Capital Gains Tax (if they’re worth more than £6,000) include:

artwork - such as a painting
collectors' items - such as a chess set
antiques - such as furniture or jewellery

However, there may be no tax to pay if both of the following apply to the possession:

it had an expected useful life of less than 50 years when you got it
it hasn’t been used in your trade or job

An example of this might be a caravan or motor-boat you bought and used for pleasure.

Business assets - such as business premises 'goodwill' and registered trade mark

Many business assets are liable to Capital Gains Tax. These may be buildings, equipment, fixtures and fittings, or even the business’s reputation (‘goodwill’). This means you must work out the gain or loss if you sell or dispose of such business assets.

Some typical business assets liable to Capital Gains tax include:

business premises - such as a shop
fixtures and fittings - such as equipment you sell with the premises
goodwill – that is the good name or reputation of the business
shares in a personal company
registered trade mark

However, you may qualify for tax reliefs that reduce the amount of Capital Gains Tax you pay. For example, you may be able to claim Business Asset Roll-Over relief if you sell a business asset and re-invest the 'proceeds' (usually the amount you receive) in a new business asset. Or you may be able to claim Entrepreneurs' Relief if you've sold your business or it's ceased trading.

Find out more about business reliefs for Capital Gains Tax

Overseas assets

Overseas assets are liable to Capital Gains Tax if you're ‘resident’ - or ‘ordinarily resident’ - in the UK. For example, if you choose to live or work in the UK and do so on a regular basis, you're probably resident here and are liable on gains arising both in and outside the UK.

Typical overseas assets include:

a holiday home abroad
shares in a foreign company
land overseas bought for development

However, if you're 'resident' in the UK but not 'domiciled' here - perhaps because you or your father were born abroad, you've lived abroad or plan to live permanently abroad - you may be able to claim what’s known as the 'remittance basis'. This means you're liable on all gains arising in the UK but are only liable on foreign gains when you bring them into (‘remit’ them to) the UK.

Residency, domicile and tax on foreign gains are complicated subjects - a lot depends on the facts of each case. See more in the guidance below or contact your Tax Office.

Download guidance on residency, domicile and the remittance basis (PDF 753K)

Contact your Tax Office

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