Capital gains tax

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.

Individuals 2022/23 2021/22
Exemption £12,300 £12,300
Standard rate 10% 10%
Higher rate 20% 20%
Trusts 2022/23 2021/22
Exemption £6,150 £6,150
Rate 20% 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.

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Madisons is a trading name of Madison Business Services Limited Registered office: Bushbury House, 435 Wilmslow Road, Withington, Manchester, M20 4AF. Company Number: 03800186, VAT Registration Number: 741 1182 67 Registered to carry on audit work in the UK and regulated for a range of investment business activities by the Institute of Chartered Accountants in England and Wales. Details about our Audit Registration can be viewed at www.auditregister.org.uk.
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