Chapter 13 - Chattels and wasting assets

Question 1

What is a chattel?

Answer 1

Tangible moveable property - vases, paintings, furniture, jewellery, greyhounds, racehorses

Question 2

How much CGT is chargeable on wasting chattels?

Answer 2

None, they are exempt

Question 3

How long does a chattel have to be useful for for it to be considered wasting?

Answer 3

If it has an expected useful life of less than 50 years

Question 4

What are examples of non wasting chattel?

Answer 4

Paintings, furniture, jewellery, plant + machinary

Question 5

What is the gains taxed on chattels that cost and produce gross proceeds of less than £6,000?

Answer 5

They are exempt

Question 6

If gross proceeds exceed £6,000, how is the taxpayer taxed?

Answer 6

The lower of:
normal gain
5/3 (gross proceeds - £6,000)

Question 7

If non-wasting chattel is sold at a loss, what are the deemed proceeds considred?

Answer 7

£6,000, to restrict loss

Question 8

How are wasting asset disposals treated?

Answer 8

Depreciated on a straight line basis:

If we buy a 20 yr copyright for £10,000 and sell if 5 years later, allowavble cost will be:

15/20 * £10,000 = £7,500