How a gain is worked out
- Take the sale proceeds. The amount you sold the asset for, or its market value if given away.
- Deduct the cost. What you paid for it, plus buying and selling costs and qualifying improvements.
- Apply the annual exempt amount. The first £3,000 of total gains in the year is tax free.
- Apply the rate. 18% within your basic rate band, 24% above it, based on your total income and gains.
The reliefs that reduce it
Several reliefs can cut or remove the bill. Private Residence Relief usually removes the gain on your main home. Business Asset Disposal Relief gives a reduced rate on qualifying business sales. Transfers between spouses and civil partners are normally free of tax, which can double the annual exempt amount available.
About to sell something valuable?
Timing, reliefs and using both partners' allowances can make a large difference to a capital gains bill. TaxTune plans the sale, claims every relief, and reports it correctly and on time.
Let us handle your capital gains tax
We calculate the gain, apply every relief you qualify for, and report and pay it within the deadlines. Fixed fee, agreed up front.
Frequently asked questions
What is capital gains tax?
It is tax on the profit when you sell or give away an asset that has risen in value, such as a second property or shares. You are taxed on the gain, not the whole amount received.
What is the capital gains tax allowance?
The annual exempt amount is £3,000. The first £3,000 of total gains in a tax year is free of capital gains tax.
What are the capital gains tax rates?
Above the allowance, gains are taxed at 18% within your basic rate band and 24% above it, depending on your total income and gains for the year.
Do I pay capital gains tax on my home?
Usually not. Private Residence Relief normally removes the gain on your main home, though it can be restricted if you let it out or used part of it exclusively for business.
How do I reduce capital gains tax?
Use your annual exempt amount, transfer assets between spouses to use both allowances, time disposals across tax years, and claim reliefs such as Business Asset Disposal Relief where they apply.