Items which have been granted conditional exemption from capital taxation (Inheritance Tax (“IHT”) or Capital Gains Tax (“CGT”)) can be purchased by private treaty by a body listed in Schedule 3 of the Inheritance Tax Act 1984 (which includes most public museums, galleries and archives in the United Kingdom) at a price which is beneficial to both the public purchaser and private vendor. This is known colloquially as a Private Treaty Sale.

Such a sale will not give rise to a charge to IHT or CGT (sections 32 (4)(a) and 32A(5)(a) of the Inheritance Tax Act 1984 and section 258 of the Taxation of Chargeable Gains Act 1992).

For example when an item that has been granted conditional exemption from Inheritance Tax, which would have been payable at 40% but for the exemption, is sold to a Schedule 3 body the purchasing body will usually only pay about 70% of the item’s agreed open market value. So an item valued at £100,000 can be acquired for £70,000.

This is made possible under an administrative arrangement known as the douceur. It entails sharing the benefit of fiscal exemption between the vendor (usually 25%) and the purchaser (usually 75%). Hence the vendor typically obtains a sweetener of 25% and the purchase price is reduced by 75%, of the IHT and CGT otherwise payable.

The arrangement follows the principles enunciated in their report in 1952 by the Waverley Committee on the Export of Works of Art etc.

Since 1982 H M Revenue & Customs has routinely requested owners of works of art, when it granted exemption, to give Arts Council England three months’ notice of an intention to sell them. 

Read details of any items which we have been notified as coming up for sale.

Further details of items for which we have received notice of sale and how Private Treaty Sales are conducted can be found in our detailed guidance on Private Treaty Sales and obtained from Gerry McQuillan, Senior Policy Adviser, Acquisitions, Exports, Loans and Collections Unit at Arts Council England on 020 7973 5108, e-mail: or Anastasia Tennant, Policy Adviser,  Acquisitions, Exports, Loans and Collections Unit at Arts Council England on 020 7973 5223, email: