Date posted: 14th Apr 2025
A negligible value claim means that a claim is made that an asset is worthless, without actually selling the asset.
For example, say you bought £10,000 worth of shares in Big Company plc in 2019, but the company has suffered since that time and the shares are unlikely to recover in value, then you may be able to claim that the shares are of negligible value and create a capital loss to offset any capital gains, without actually disposing of the shares.
If you make a claim and the asset does recover in value, then a capital gain may arise in the future. If you sell the shares for £10,000, then there will be a capital gain of £10,000 as the shares will have no base cost, as the original cost was claimed in earlier tax years.
There is a publicly available list at https://www.gov.uk/guidance/negligible-value-agreements – if the asset is not on the list, it does not mean that a claim is not available, but it means that a separate election is required on your tax return, which could be subject to HMRC challenge.
A negligible value claim can be used in an earlier tax year if the conditions are all met. This allows flexibility in managing a taxpayer’s affairs.
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