Capital Gains Tax Planning

The annual exempt amount for individuals is £3,000 for 2026/27. That’s the gain you can make in a tax year before CGT becomes payable. It has fallen sharply in recent years. It was £12,300 as recently as 2022/23, so many more disposals now produce a taxable gain than would have done a few years ago. The allowance for most trustees is £1,500.

If you sell a UK residential property and CGT is due, yes. HMRC requires a report and payment within 60 days of the completion date. This applies to completions on or after 27 October 2021. Miss the deadline and interest and penalties follow, even if you file a self assessment return later in the year. Other disposals (shares, commercial property, business assets) are generally reported through self assessment by the 31 January deadline following the tax year of disposal.

Usually not. Private Residence Relief (PRR) exempts gains on a property you’ve lived in as your main home throughout your period of ownership. If you’ve let the property, used part of it for business, or been absent for extended periods, relief may be only partial, and any period of letting can create a taxable gain on that proportion. If the property has always been your main home with no complications, you’re likely fully relieved. If it hasn’t, it’s worth checking before you sell rather than after.

Take the sale proceeds, deduct the original cost plus qualifying improvement expenditure and allowable selling costs, and the difference is your gain. Set that against your £3,000 annual exempt amount and the remainder is taxed at 18% or 24% depending on where it lands relative to your income. It’s computation, not a rule of thumb, and timing the sale relative to your income in a given year can make a real difference to the rate that applies.

Yes. Gains on shares are subject to CGT at 18% or 24%, and the £3,000 annual exempt amount applies across all your gains in the tax year, not separately per asset. The cost basis calculation involves pooling rules and the 30-day same-day and bed-and-breakfast provisions, which are straightforward to get wrong if you’re computing it yourself. Shares held in an ISA are exempt from CGT entirely.

BADR reduces the CGT rate to 18% on qualifying gains up to a £1,000,000 cumulative lifetime limit. It applies to disposals of business assets where you’ve owned the business (or shares in your personal company) for at least two years and meet conditions around your role and shareholding. The rate rose to 18% from 6 April 2026. It was 10% before April 2025 and 14% in 2025/26. The lifetime limit is cumulative, so previous BADR claims count against it. Whether you qualify depends on the specifics, and it’s worth checking well before you sell.

Yes, but only if you take advice before contracts are exchanged. Options include timing the disposal to use your annual exempt amount, transferring assets between spouses at no gain / no loss before sale, claiming Business Asset Disposal Relief if you qualify, and considering whether the gain interacts with income in a way that pushes you into a higher band. Once you’ve completed, most of those doors close. The earlier the conversation, the more there is to work with.

Generally, you don’t need to report through self assessment if your total gains for the year are below £3,000, though if you’re already registered for self assessment, or your total proceeds are above a certain level, separate rules can still apply. For UK residential property sales, even where no CGT is due, you may need to consider whether a 60-day return is required. If you’re unsure, a quick check is cheaper than assuming you’re below the threshold and finding out later that HMRC disagrees.