By 
What is CGT?
Capital Gains Tax (‘CGT’) is the tax you pay when you sell an asset. So if you are selling a property or an investment, you will need to consider CGT. In fact, anything you don’t own for business purposes (meaning you haven’t bought to sell) will fall under CGT’s purview.
Any profit you make is taxed at the rate of income tax you pay. So if you are a 40% taxpayer, you will pay CGT on the profit at 40%. If you are a base rate taxpayer, you will pay CGT at 20% on the profit within your remaining base rate tax band and 40% on the excess.
Okay, this is pretty straightforward, but based on the above, the reach of CGT is huge! (since it covers any item you didn’t buy to sell). Well, this is correct, it has a very broad scope, but the interesting thing is that there are many exemptions that take assets out of the scope of CGT. We’ll take a quick look at these so you can see what you can sell without having to account for CGT.
Exemptions from Capital Gains Tax
your own house
As most of you probably know, an investment in your own home is free of capital gains tax (and income tax as well).
Movable property that is wasting assets
There is a general exemption from capital gains tax for “tangible personal property” which is also classified as wasted assets.
Generally speaking, if an asset has a foreseeable life of less than fifty years, it is exempt from capital gains tax. An item of machinery is considered to have a predictable life of less than fifty years and will therefore generally be an asset that is wasted.
Therefore, many goods that have an element of machinery should in principle be exempt (for example, antique clocks and watches).
gambling winnings
Anything you win from gambling is received entirely tax-free. Therefore, there is no capital gains tax, and there will also be no income tax or national insurance due.
Personal compensation or damages
Most forms of compensation will be exempt from capital gains tax
cars
There is a capital gains tax exemption for “regular cars”.
debts
There is a capital gains tax exemption for the disposition of a debt by the original creditor
Movable property worth less than £6,000
Even if you have tangible personal property that doesn’t qualify as ‘wasted’ assets, there should be a capital gains tax exemption available if the income is less than £6,000.
The annual exemption from capital gains tax
It’s also worth noting that everyone has an annual capital gains tax exemption (currently £9,200) that’s available to cover capital gains. So if your gain is less than this, there is no capital gains tax due at all (this means a couple could buy an asset together and then sell it eliminating £18,400 gains due to the two annual exemptions).
This should give you some advice on what assets you can sell without incurring capital gains tax. We cover all of this and more in detail through our website http://www.wealthprotectionreport.co.uk