Tax news · June 2026
Capital gains tax rates have increased and the tax free allowance is frozen at 3,000 pounds. Here is what changed, who it affects, and how to soften the blow.
Capital gains tax has become noticeably more expensive. The main rates were increased to 18 per cent and 24 per cent, bringing the rates on shares, crypto and most other assets into line with the rates already used for residential property. At the same time the annual tax free allowance remains frozen at just 3,000 pounds, a fraction of the 12,300 pounds it was only a few years ago. Together these changes mean far more people pay capital gains tax, and pay more of it.
For disposals of shares, funds, crypto and business assets, the basic rate of capital gains tax is now 18 per cent and the higher rate is 24 per cent, depending on where the gain sits once added to your income. The annual exempt amount, the slice of gains you can make tax free each year, stays at 3,000 pounds. Business Asset Disposal Relief, which gives a lower rate when you sell a qualifying business, has also been increasing in stages and is no longer as generous as it once was.
This reaches a wide group, including investors selling shares or funds outside an ISA, anyone disposing of cryptocurrency, landlords and second home owners selling property, and business owners selling up. Because the allowance is so small, even modest gains now produce a bill, and the higher rates mean that bill is larger than it would have been a year or two ago.
There is a lot of legitimate planning that helps. Use your 3,000 pound allowance every year rather than letting it go to waste, because it cannot be carried forward. Transfer assets to a spouse before selling so that two allowances and possibly a lower tax band are used. Hold investments inside an ISA or pension, where gains are tax free. Realise gains and losses in the same year so losses offset gains. And think about timing, because spreading disposals across two tax years can use two years of allowances and keep more in the lower band.
Our honest view is that the combination of higher rates and a frozen allowance is a quiet but significant tax rise that many people will only notice when they come to sell. The good news is that capital gains tax is one of the most plannable taxes there is, because you usually control the timing of a sale. The people who lose out are those who sell without thinking about the tax first, while those who plan a year or two ahead can often cut the bill substantially or remove it altogether. If you are sitting on gains, it is well worth a conversation before you sell, not after.
We work out your gains correctly, use every allowance, loss and spouse transfer available, and plan the timing of disposals to keep the tax as low as the rules allow. Book a free call back before you sell and we will look at the most efficient way to do it.
For most assets the rates are 18 per cent within the basic rate band and 24 per cent above it, after your 3,000 pound annual exempt amount. The rates on shares and crypto now match those on residential property.
Use your annual allowance each year, transfer assets to a spouse to use two allowances, hold investments in an ISA or pension, offset losses against gains, and spread larger disposals across two tax years.
We will plan the timing and use every allowance to keep your capital gains tax as low as possible. Book a free call back before you sell.