{"id":3825,"date":"2019-09-20T09:35:43","date_gmt":"2019-09-20T09:35:43","guid":{"rendered":"https:\/\/www.georgehay.co.uk\/blogs\/?p=3825"},"modified":"2023-11-16T09:19:42","modified_gmt":"2023-11-16T09:19:42","slug":"will-pay-capital-gains-tax-classic-car","status":"publish","type":"post","link":"https:\/\/www.georgehay.co.uk\/blogs\/2019\/09\/will-pay-capital-gains-tax-classic-car\/","title":{"rendered":"Will I pay Capital Gains Tax on a classic car?"},"content":{"rendered":"

By definition, Capital Gains Tax (CGT) is a tax on the profit that you make when you sell, or dispose of, an asset that has increased in value.<\/span><\/p>\n

Having invested in a classic or vintage car, you may find that its value increases during the course of ownership. This is in contrast to most standard motor vehicles which tend to depreciate over time.<\/span><\/p>\n

So, the question then follows, is CGT payable upon the disposal of a classic or vintage vehicle?<\/span><\/p>\n

 <\/p>\n

Capital Gains Tax on a classic car…to pay or not to pay?<\/span><\/h5>\n

Unlike other types of investment, the profit you make upon the disposal of a classic car does not generally attract CGT.<\/span><\/p>\n

This is because they are classed as a \u2018wasting asset\u2019; in other words, an asset that is estimated to have less than 50 years\u2019 worth of use remaining. Even if the vehicle remains in existence for a period in excess of those 50 years, the same exemption applies.<\/span><\/p>\n

However, when determining whether or not CGT applies, the purpose for which you use the vehicle must be considered.<\/span><\/p>\n

It\u2019s worth bearing in mind that where the car has been used for the purposes of a business and tax allowances have, or could have been claimed on it, the exemption would not apply. Tax would, therefore, be on due upon disposal of the asset.<\/span><\/p>\n

The exemption applies to all motor vehicles which were constructed, or have been adapted, to carry passengers. The exception to this rule is where the type of vehicle is not normally used as a private vehicle and is unsuited for such use.<\/span><\/p>\n

Normal motor cars are, therefore, exempt from Capital Gains Tax (CGT). This includes vintage cars of this type. The types of cars not included in this exemption are;<\/span><\/p>\n