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This is a freeview 'At a glance' guide to Capital Gains Tax and gifts.

What are the Capital Gains Tax (CGT) implications of giving away assets? What exemptions and reliefs are there for gifts? 

Subscribers also see How to calculate a capital gain or loss and CGT reliefs: disposal of a business or its assets

At a glance

There are various reliefs and exemptions applicable to CGT which apply for gifts:

See An index to Capital Gains Tax reliefs

Overview and examples

How do I calculate the CGT on a gift?

As a gift is a CGT disposal the normal rules apply for calculating CGT:

If the gift results in a capital loss and the gift is to a Connected person this will be a clogged loss and special rules apply.

What reliefs and exemptions can I claim when I give away an asset?

Certain reliefs and exemptions apply to gifts of assets in the same way as they do to sales of assets.

Certain reliefs only apply to gifts and transfers at an undervalue:

How do I pay the tax when I haven’t received any money for the asset?

How do I work out my cost if an asset was given to me?

When you are given a gift, because the person giving it to you is treated as making a disposal at market value then your cost for future disposals is that same market value, except where certain reliefs were claimed when the gift was made.

Some reliefs cause the gain triggered by the gift to be passed onto the donee by rolling or holding it over into their acquisition cost. These are:

For example:

Elizabeth gives her son Charles shares in her trading company when they are worth £1m. As she only paid £10,000 for them she has a gain of £990,000. They claim business asset gift relief under s.165 (see above). 

See How to calculate a capital gain or loss 

If you inherited the asset on someone’s death then your cost is the market value at the date of death i.e. the probate value.

See CGT and death

Other taxes


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