Beware the Valuable Heirlooms with a Costly Sting in the Tail
Families with precious assets passed down through the generations have been advised their heirlooms may bring an unexpected tax sting.
Television’s renaissance of The Antiques Roadshow has helped fuel interest in heritage artefacts, while Russian and Chinese treasures which have remained in families for decades are among those now attracting the most impressive prices at auction.
However, Chiene + Tait Chartered Accountants is advising would-be vendors, including many hard-pressed owners of heritage homes and estates, to undertake proper tax planning before putting heirlooms under the hammer.
The firm has a 125-year pedigree and is a specialist in helping families ensure valuable assets are protected through the generations. Its impressive client list includes families who have remained with the firm for decades.
Tax Partner Helen Mackenzie highlighted a recent case where a client sold a valuable objet d’art – a beautifully carved rhino horn found unexpectedly in the back of a cupboard.
She said: “There are items that might not seem valuable and indeed may not have been particularly saleable in the past, which may now have special attractions for a foreign buyer.
“This particular client found an antique carved rhinoceros horn cup, which had been owned by his late grandfather and not thought to be valuable.
“However, the horn was subsequently sold at a London auction house with a hammer price of over £50,000. However these items come with a nasty surprise – capital gains tax.”
Capital Gains Tax is due on any item sold for more than £6,000 and artefacts or inherited antiques and artworks from long lost family members may be subject to hefty tax bills when sold, restricting the amount the seller receives.
Helen added: “Not everyone is in the fortunate position of having inherited heirlooms, which have passed down the generations. For those keen to realise value from family heritage items, the big figures quoted on programmes like the Antiques Roadshow have a hidden tax sting in the tail.
“The clear lesson here is that anyone contemplating the sale of a valuable asset should carefully consider the tax implications. There are simple steps that can be taken to mitigate capital gains tax. Before rushing out to sell an item for thousands of pounds, independent advice should be sought to help limit the slice taken by the taxman.”
Helen expects the issue to become more prominent as rich foreign investors display an appetite for aretefacts which have been in British families for centuries, at a time when many owners are feeling the financial squeeze associated with running stately homes or large estates.
Chiene + Tait, which is based in Edinburgh and specialises in capital tax planning for private clients, prides itself on keeping all advice straight-forward and clear.
With its long-term approach taking in the aims of clients, their families and future generations, the Chiene + Tait team is adept at tailoring advice for inheritance tax planning to work with all individuals – grandparents, parents, children and trustees.
Helen added: “Our business is helping families build solid foundations for the future and pass on wealth in the most tax efficient way and at the most appropriate time. However, in many cases there is a lot more than just the financial aspects involved.
“The responsibility which comes with generations of ownership runs incredibly deep and it may be that the sale of an heirloom is only considered with a great deal of reluctance.
“This is something we fully understand and we have been helping families manage these issues for a very long time. Clients appreciate that considerable experience when they are making what are often difficult decisions.”
More information about the company can be found at http://www.chiene.co.uk/ and Tax Partner Helen Mackenzie can be contacted on helen.mackenzie@chiene.co.uk
ENDS
Note to Editors
Chiene + Tait Chartered Accountants, based at Dublin Street Edinburgh and in 2010 celebrated its 125th anniversary. In addition to accounting, the firm offers advice in the fields of assurance, VAT, employment, personal and corporate taxation, management accounts, risk advisory, corporate finance, specialist sector advice and Tax, IT and HR consultancies.
Issued on behalf of Chiene + Tait by www.holyroodpr.co.uk. Further information on 0131 561 2244 or info@holyroodpr.co.uk.