Capital Gains Tax
- CGT is payable by individuals, trustees and personal representatives (PRs). Companies pay corporation tax on their capital gains.
- There are annual tax-free allowances (the ‘annual exempt amount’) for individuals, trustees and PRs. Companies do not have an annual exempt amount.
- For individuals, net gains are added to total taxable income to determine the appropriate rate of tax. The standard rate applies only to the net gains which, when added to total taxable income, do not exceed the basic rate band.
- Gains which qualify for Investors’ Relief are charged at 10% for the first £10m of qualifying gains.
- Gains which qualify for Business Asset Disposal Relief are charged at 10% for the first £1 million.
Rates and annual exemption
| Individuals | 2022/23 |
|---|---|
| £ | |
| Exemption | 12,300 |
| Standard rate | 10% |
| Higher rate | 20% |
The higher rate applies to higher rate and additional rate taxpayers.
Gains accruing on the disposal of certain residential property and arising on carried interest can attract a standard rate of 18% or a higher rate of 28% for individuals and of 28% for Trusts and Personal Representatives.
| Trusts | 2022/23 |
|---|---|
| £ | |
| Exemption | 6,150 |
| Rate | 20% |
- CGT is payable by individuals, trustees and personal representatives (PRs) . Companies pay corporation tax on their capital gains.
- There are annual tax-free allowances (the ‘annual exempt amount’) for individuals, trustees and PRs. Companies do not have an annual exempt amount.
- For individuals, net gains are added to total taxable income to determine the appropriate rate of tax. The standard rate applies only to the net gains which, when added to total taxable income, do not exceed the basic rate band .
- Gains which qualify for Investors’ Relief are charged at 10% for the first £10m of qualifying gains.
- Gains which qualify for Business Asset Disposal Relief are charged at 10% for the first £1 million.
Rates and annual exemption
| Individuals | 2021/22 |
|---|---|
| £ | |
| Exemption | 12,300 |
| Standard rate | 10% |
| Higher rate | 20% |
The higher rate applies to higher rate and additional rate taxpayers.
Gains accruing on the disposal of certain residential property and arising on carried interest can attract a standard rate of 18% or a higher rate of 28% for individuals and a rate of 28% for Trusts and Personal Representatives.
| Trusts | 2021/22 |
|---|---|
| £ | |
| Exemption | 6,150 |
| Rate | 20% |
© This publication is published for the information of clients. It provides only an overview of the regulations in force at the date of publication and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this publication can be accepted by the authors or the firm.