London-based WineCap has just released its 2025 Wealth Report, based on new research among UK wealth managers, exploring how fine wine is evolving from a niche passion asset into a tax-efficient component of diversified portfolios.

A new report from WineCap reveals that 96 per cent of UK wealth managers expect demand for fine wine to grow in 2025 – more than for any other luxury asset.

Eighty per cent of wealth managers said that fine wine’s exemption from Capital Gains Tax (CGT) is creating renewed investor interest amid tightening tax rules. A generational shift is also underway, with younger, tech-enabled investors embracing wine as a financial instrument.

“Our survey found that a younger generation of investors is entering the market, leveraging AI-driven tools and new strategies to navigate this historically exclusive asset,” said Alexander Westgarth, founder and CEO of WineCap. “Simultaneously, experienced collectors are liquidating holdings, leading to price corrections and more stock availability. Like all shifts, these have disturbed the equilibrium but also laid the foundation for a more resilient and accessible fine wine market.”

Westgarth said that fine wine is no longer reserved for collectors and connoisseurs. “Year after year our research shows that it is being viewed as a serious asset with strong fundamentals for growth, and valuable tax advantages,” he said. 

Market shifts and generational change
The report highlights a market in flux: seasoned collectors are beginning to liquidate long-held assets, creating increased supply and driving a slight dip in average portfolio allocations – from 10.8 per cent in 2024 to 7.8 per cent in 2025. However, this rebalancing is creating opportunities for new entrants, particularly among Millennials and Gen Z investors who prioritise tangibility, transparency, and long-term performance.

Fine wine is also increasingly appearing in higher-risk strategies. “Our survey showed that the proportion of fine wine in high-risk investment portfolios has more than doubled (12 per cent in 2024 to 26 per cent in 2025). While 74 per cent of fine wine investments remain in cautious portfolios, this signals growing confidence in its performance beyond traditional safe-haven assets,” Westgarth continued.

This shift raises an important question: has fine wine become a more volatile asset, or are investors simply willing to embrace its potential? The answer varies by region, the report shows. Burgundy, for example, presents a classic higher risk, higher-reward scenario, while regions such as Bordeaux and Italy have demonstrated remarkable resilience.

As technology enhances market access and analysis, fine wine is attracting a new wave of investors who are more comfortable with risk and more strategic in their allocations. This evolution marks a pivotal moment in fine wine’s journey from a niche asset to an essential component of diversified portfolios, the report states.

Tax efficiency and diversification at the forefront
Fine wine’s unique tax status under UK law – classified as a ‘wasting asset’ and therefore exempt from Capital Gains Tax – makes it increasingly attractive at a time when HMRC has reduced tax-free allowances and raised effective rates. The report shows that 80 per cent of wealth managers believe demand will rise due to this exemption alone.

WineCap surveyed 50 UK-based full-time wealth and investment managers in January 2025 on their views and sentiments towards fine wine. Thirty-five of the respondents classed themselves as wealth managers, and 15 as independent financial advisors. The research was conducted via an online questionnaire.