02: Disposal of assets

CGT can only arise on your disposal of an asset. Normally this means its sale, but it could also mean a gift or insurance claim or compensation for loss or damage to an asset that you own.

The value on which the gain (or loss) is based is normally the consideration you receive. However, on gifts and certain sales (eg with a family member), the open market value is used instead.

CGT is not normally payable when a person dies. The beneficiaries of a deceased person’s estate are then treated as if they had acquired the assets of the deceased at their market value on death. This is one of the main reasons why most people avoid paying CGT.