Introduction

When a chargeable asset is transferred between two spouses or civil partners, there is a disposal by the transferor spouse / civil partner and an acquisition by the transferee spouse / civil partner for capital gains tax purposes. For simplicity, spouses and civil partners are referred to jointly as ‘spouses’ in this guidance note, but the commentary applies equally to both. For a discussion on the meaning of chargeable asset, see the Exempt assets for capital gains tax guidance note.

No gain / no loss transfers

The disposal is deemed to take place at ‘no gain / no loss’ (which may also be written as NGNL) provided the couple is:

1. •

   married or in civil partnership, and

2. •

   living together during the tax year

TCGA 1992, s 58(1A), (1B)

This has always been the case, but the no gain / no loss treatment was extended for separated couples where the disposal takes place on or after 6 April 2023. See ‘Separation and divorce’ below.

In Scotland, a ‘common-law’ marriage is recognised as a legal marriage once