Shares in a Racehorse Exempt from CGT? (PNTA)

madeleinedampier

I'm revising for my PNTA exam and came across a question asking whether selling shares in a racehorse for £30,000 is subject to Capital Gains Tax. The answer in the book states that it is exempt, but I’m unsure why. I understand that a racehorse itself is a wasting chattel and therefore exempt, but my understanding is that shares are generally liable to CGT. Since this question refers to selling shares (not the actual horse), wouldn’t they be taxable? I know the book provides the answer, but I’d really appreciate it if someone could clarify the reasoning behind this.

soahsoa

Which book is it?

shamilkaria

Hi @madeleinedampier

I hope you are well?

You are correct that animals are known as wasting chattels with a life expectancy of less 50 years and are moveable plus tangible. With regards to the shares, one thing I have noted is in the exam anything with live animals generally relates to exempt even if they say ,shares". In the book they may have meant selling the horse maybe. Best would be just stick with exempt relating to live animals.

Hope this helps.

Many thanks

Shamil