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HMRC internal manual

Capital Gains Manual

Chattels: examples: marginal relief

Miss S sells an antique mirror for £7,500. Her chargeable gain after allowing expenses is £5,000.

As the disposal consideration exceeds £6,000, the gain is not exempt but marginal relief is due.

This restricts the gain to:

consideration 7,500
less 6,000
excess 1,500

Chargeable gain not to exceed 1500 x 5/3 = £2,500

Gain before marginal relief = £5,000


NOTE. If a taxpayer is within the charge to Capital Gains Tax, neither indexation allowance nor taper relief apply to disposals of assets on or after 6 April 2008. Previously indexation allowance had been frozen at April 1998. Companies and other concerns within the charge to Corporation Tax are not affected by these changes. For indexation allowance see CG17207+ and for taper relief see CG17895+.