Exempt assets for capital gains tax

Produced by Tolley

The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Exempt assets for capital gains tax
  • Examples of exempt assets
  • Only or main residence
  • Cars
  • Chattels
  • Shares and securities
  • Gilts
  • Cash
  • Life assurance policies
  • Miscellaneous assets

Exempt assets for capital gains tax

In general terms, a charge to capital gains tax arises when a chargeable person makes a chargeable disposal of a chargeable asset. The disposal may produce a profit (known as a gain) or a loss.

Chargeable person and chargeable disposals are discussed in the Introduction to capital gains tax guidance note. Details of how to calculate the gain or loss or given in the Basic calculation principles of capital gains tax guidance note.

Assets are chargeable for capital gains tax purposes unless they are specifically exempt.

Examples of exempt assets

If assets are exempt from capital gains tax, this means that gains are not chargeable but also losses are not allowable. Common examples of exempt assets are discussed below.

Only or main residence

An individual’s only or main residence is usually exempt from capital gains tax, although the situation is more complicated when the individual owns more than one property. See the Principal private residence relief ― basic principles guidance note.


Cars, defined as mechanically propelled road vehicle(s) suitable for the conveyance of passengers, are exempt assets for capital gains tax. Vans and lorries do not meet this definition; however, they are wasting chattels and so are exempt from capital gains tax under another provision (see below).


Wasting chattels, defined as tangible, moveable property with a useful life of 50 years or less, are exempt assets. Greyhounds, racehorses, computers

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