A. The chattels exemption can apply to disposals of tangible moveable property for £6,000 or less. If the consideration exceeds £6,000 the chargeable gain is restricted to five-thirds of the excess. These rules will not assist your client.
However, a gain from tangible moveable property which is a wasting asset is completely exempt from capital gains tax irrespective of the level of sales consideration. Plant and machinery is a wasting asset and HMRC accept that a watch is classified as machinery so your client’s capital gain will be completely exempt. This does of cause assume the disposal is in fact a capital disposal and your client is not carrying on trading activities.
If you have a tax question, then why not call the Tax advice line on 0844 892 2470? Our experts have a wealth of knowledge on all aspects and will be happy to assist you. We can also provide a written consultancy service at £180 per hour plus VAT.
