Capital Gains Tax: What You Need to Know
💡 What Is Capital Gains Tax (CGT)?
Capital Gains Tax is a tax on the profit you make when you sell or dispose of an asset that has increased in value. It’s the “gain” you’re taxed on—not the total amount you receive.
When Does CGT Apply?
🔑 Examples of Taxable Events:
📜 Selling shares or investments.
🏠 Selling property (that isn’t your main home).
🎨 Disposing of valuable assets like antiques or artwork.
Key Exemptions
✅ Some gains are tax-free, including:
Profits from selling your primary residence.
Gains within your annual tax-free allowance (£6,000 for 2023/24).
Assets gifted to your spouse or civil partner.
💡 Tip: Check if you qualify for Entrepreneurs’ Relief or other allowances!
How Much Will I Pay?
💷 CGT rates depend on:
1️⃣ Your total taxable income.
2️⃣ Whether the gain is from property or other assets.
🔢 Current Rates (2023/24):
Basic rate taxpayers: 10% (20% for property).
Higher rate taxpayers: 20% (28% for property).
Reporting and Paying CGT
📅 Deadline:
You must report and pay CGT within 60 days of selling property or by the Self-Assessment deadline for other assets.
💻 How to Report:
Use the HMRC online service or Self-Assessment tax return.
Reduce Your CGT Bill
💼 Strategies to Save:
Utilize your tax-free allowance annually.
Offset losses from other disposals against your gains.
Transfer assets to your spouse to benefit from their tax-free allowance or lower tax rate.