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Investment in Classic High Value Watches

Investment in Classic High Value Watches

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I have a limited company client with 2 director/shareholders who have a reasonable amount of cash in the bank generated from some success in the building trade.

They have been looking at various investment opportunities and have decided that they would like to purchase classic watches as an alternative method of investment. The watches would be held securley in a display cabinet and not be used by any individual.

What are the accounting requirements for the company and the tax implications? I assume that the watches would be disclosed as an investment and any gains subject to CGT?

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By George Attazder
21st Sep 2011 11:11

I think you'll find that they're exempt from CGT...

... by virtue of being tangible moveable property which is deemed to be a wasting asset, because of S.44(1)(c), which deems plant and machinery to always have a useful life of less than 50 years.  I think you'll find that a watch is machinery.  That's certainly the case for clocks.

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