Gazin 2005 + 105% | Screaming Eagle 2010 + 28.4% | Lafleur 1999 + 30% | Laville Haut Brion 2003 + 44% | Pavillon Rouge 2008 + 17.5% | Dominus 1997 + 24.5% | Dominus 1998 + 24.5% | Angelus 2012 + 25% | Lafleur 2006 + 20% | Fleur Petrus 2008 + 20% | Beychevelle 2010 + 96% | Clinet 1998 + 25% | Latour 1988 + 17.5% | Cheval Blanc 2000 + 17.5% | Angelus 2005 + 20.83% |

Capital Gains Tax

Inland Revenue Statement regarding Capital Gains Tax on Fine Wine

The following information is taken from a bulletin issued by the Inland Revenue in August 1999 concerning the capital gains tax treatment on wines and spirits. This is reproduced as a guide only, and we recommend that you take advice from your financial adviser on the subject.

"Where bottled wine is purchased each bottle is a chattel for CGT purposes. As gains on the disposal of chattels which are also wasting assets are generally exempt from CGT, section 45(1) Taxation of Chargeable Gains Act (TCGA), then the first question is whether bottled wine is a wasting asset or not.

For CGT purposes a wasting asset is one who's predictable life, from the point of view of the person acquiring it, does not exceed 50 years, Section 44(1) TGGA. Whilst this definition would clearly apply to cheap table wine which may turn to vinegar within a relatively short period, even in unopened bottles, our view is that it would certainly not apply to port and other fortified wines which are generally recognised to have a very long storage life.

Between these extremities, there are a number of fine wines which are quite drinkable after a substantial period although of course the taste alters over that time. With these the basic consideration, in our view, is whether the wine has turned to vinegar or merely matured. Of course in practice, most wine is drunk well below the age of 50 years and in that sense it is very difficult to consider the issue in isolation. However, where the facts justify it, we would normally contend that wine is not a wasting asset if it appears to be a fine wine which not unusually is kept (or some samples of which are kept) for substantial periods sometimes well in excess of 50 years.

If a particular bottle of wine is not a wasting asset, then any gain accruing on its disposal may nevertheless be exempt where the disposal proceeds for that single bottle do not exceed £6,000, section 262(1) TGGA. Where, however, a number of bottles are sold to the same period in one or more transactions, then the question might arise as to whether the bottles themselves constitute a "set". If they do, the £6,000 limit would apply to the overall sale proceeds rather than the price fetched for any individual bottle, Section 262(4). This is a question of fact and would depend on:

a. Whether the bottles are "similar and complementary" which would require the wine in them to have been produced from the same vineyard in the same vintage year, and

b. Whether the bottles are of greater worth when sold collectively than when sold individually."

This is the Inland Revenue's current position on the matter.

"...wasting assets are generally exempt from Gapital Gains Tax..."