Tax & Accounting News

Tax-free profits on classic cars

27/05/2010

The TV and radio personality Chris Evans recently highlighted a little-known Capital Gains Tax (CGT) concession after he splashed out on a rare 1963 Ferrari worth £12million.

The purchase was partially funded through the sale of other classic cars in his collection, but Mr Evans did not have to pay CGT on the profits from these sales.

This is because a car, like most items of machinery, is considered a ‘wasting’ asset, because – much like a racehorse or fine wine – it has an expected lifespan of less than 50 years.

Other personal possessions, such as artwork or antiques, also attract no CGT if they are sold for less than £6,000 each.

With probable increases in CGT on the horizon, such purchases may increase in popularity over the coming years. For more information please contact us.