CG11700P - Introduction and computation: chargeable assets: introduction: contents

TCGA92/S1 (1) & TCGA92/S21 (1)

Chargeable gains accrue on the disposal of assets. Assets include all forms of property wherever they are situated including

  • shares and securities
  • interests in land
  • options, debts and rights over property
  • any currency other than sterling (the £ sterling being simply the unit of measurement of value)
  • any property which was created by the person disposing of it such as business or professional goodwill, copyright or a lease (by the granting of it).

The definition of an asset in TCGA92/S21 (1)(a) includes incorporeal property generally. In this context, incorporeal property includes contractual rights, whether or not those rights are capable of being transferred or assigned, and whether or not they have a market value (O`Brien v Benson’s Hosiery (Holdings) Ltd, 53TC241), see CG12020.

Some assets can be disposed of without a capital gains charge, see CG12600+.For example

  • private motor vehicles
  • an individual’s only or main residence (having gardens or grounds of half a hectare or less) which has been occupied as such throughout the period of ownership
  • tangible moveable property, that is chattels such as household goods and personal effects, worth less than £6,000
  • chattels with a predictable life of 50 years or less (unless used for the purposes of a trade, profession or vocation)
  • SAYE (Save-as-you-earn) contracts, National Savings Certificates, Premium Bonds, British Government Securities, qualifying corporate bonds
  • certain investments in Personal Equity Plans, Individual Savings Accounts and under the Business Expansion Scheme
  • the receipt of personal injury compensation
  • the receipt of winnings from betting, including pool betting, or lotteries or games with prizes.

TCGA92/S16

If a chargeable gain is deemed not to accrue on the disposal of an asset then equally no relief is available if the asset is disposed of at a loss. In other words there is no allowable loss to be included in the capital gains computation.

TCGA92/S1 (1)

Capital Gains Tax is charged under TCGA92/S1 (1) on the disposal of assets, but it is important to bear in mind that the legal owner of an asset is not necessarily its beneficial owner and that it is beneficial ownership (not legal ownership) which the tax principally follows. The point is particularly important in relation to partnership assets, see CG27000, family and matrimonial or civil partnership property, see CG65300+, and real property (land) generally, see CG70500+. Detailed instructions are given at CG34300+.