Tx notes fa22 Final

1.1. Chargeable Disposal 
A chargeable disposal will usually occur by the sale of whole or part of an asset but will also arise 
when an asset is gifted, lost or destroyed. There is no chargeable disposal upon the death of the 
taxpayer, when assets will pass free of CGT to the beneficiaries at their market (probate) value. 
1.2. Chargeable Assets 
All assets are chargeable unless specifically exempted.
Exempt assets include:
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Motor vehicles suitable for private use
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National Savings & Investment certificates
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Foreign currency for private use
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Decorations awarded for bravery
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Damages for personal injury
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Life insurance policies
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Works of art given for national use
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Gilt edged securities (Government Securities such as Exchequer Stock)
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Qualifying Corporate Bonds (Corporate loan stock)
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Certain Chattels (tangible moveable property such as antiques)
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Investments held in an ISA

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1.3. Chargeable Person 
An individual who is resident in the UK is a Chargeable Person and is therefore liable on their 
worldwide assets.
1.4.
 
CGT computation 
A chargeable gain or allowable loss of an individual is computed for each individual asset as 
follows: 
The 
disposal consideration
or proceeds is usually the proceeds received for the asset.
However, market value must be substituted for actual proceeds where: 
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a disposal is not made at arm’s length, (e.g. a gift) 
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this includes disposals made to connected parties – i.e. close relatives (parents, siblings 
and children).
Incidental costs of disposal (e.g. auctioneer’s fees, estate agent fees and legal costs) may be 
deducted from the consideration to give net proceeds.
When quoted shares are gifted the value may not be given in the exam and should be 
calculated as the mid price based on the day’s quoted prices given in the question.