Income Tax on selling horse

nomunnnofun

Hi all,

My friend keeps jump horses as a hobby. His day work is in a totally different area. He owns three and has trained them from a young age. One of them is very good and he is expecting to sell it shortly for quite a large sum. 40K approx. Is this taxable? I know there are some rules about money from horses being exempt from Tax but not sure if you have to be a registered stud farm or how it works. Any general info or links to applicable reliefs would be most welcome.:)

LiamACA

nomunnnofun wrote: »

Hi all,

My friend keeps jump horses as a hobby. His day work is in a totally different area. He owns three and has trained them from a young age. One of them is very good and he is expecting to sell it shortly for quite a large sum. 40K approx. Is this taxable? I know there are some rules about money from horses being exempt from Tax but not sure if you have to be a registered stud farm or how it works. Any general info or links to applicable reliefs would be most welcome.:)

Your friend is in the clear. A horse is exempt from Capital Gains tax. It is not his business (there is an outline called badges of trade that need to be satisfied in order for a business to be considered ongoing). His horses would not be considered stock in trade and so would not be considered a 'farmer' and liable to income tax.

nomunnnofun

Hi LiamACA,

Thanks very much for this explanation. Exactly what I needed to know.