What is Capital Gains Tax in the UK?
When you dispose of (sell) an asset like shares or a second home that has increased in value, you must pay Capital Gains Tax (CGT) to HMRC on the profit.
The £3,000 Exemption Allowance
The UK annual tax-free CGT allowance is set at £3,000 for individuals. Gains below this are completely tax-exempt.
2026 CGT Rates by Asset Type
CGT rates depend on your income tax bracket and the type of asset sold:
1. Shares & Other Assets
- Basic Rate Taxpayer: 10% CGT.
- Higher/Additional Rate Taxpayer: 20% CGT.
2. Residential Properties (Non-PRR)
- Basic Rate Taxpayer: 18% CGT.
- Higher/Additional Rate Taxpayer: 24% CGT.
Action Plan: Plan Assets Disposal
- Utilize Spousal Transfer: You can transfer assets to a spouse to double your combined tax-free allowance to £6,000.
- Estimate CGT Liability: Use our UK Capital Gains Tax (CGT) Calculator to estimate tax bills.
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