What is Capital Gains Tax and when do I pay it?

Capital Gains Tax (CGT) is charged on the profit (gain) you make when you sell or give away an asset that has increased in value, not the total sale proceeds. You pay CGT on the gain above your annual exempt amount (£3,000 for 2026/27). Common assets include shares, investment property, business assets, and most things worth over £6,000. CGT on residential property sales must be reported and paid within 60 days of completion. Other gains are reported via self-assessment by 31 January.

What are the CGT rates for 2026/27?

From 6 April 2025 the rates are: 18% for gains falling in your basic-rate income tax band and 24% for gains above that. These same rates apply to both residential property and shares/other assets. Business Asset Disposal Relief (BADR) has a flat rate of 18% from April 2026 (raised from 10% following the October 2024 Budget). Scotland has different income tax bands which affect how much of the basic-rate band is available, but the CGT rates themselves are set by Westminster.

What is the annual CGT exempt amount?

The annual exempt amount (AEA) is an allowance that reduces your taxable gain. For 2026/27 it is £3,000. It was £12,300 until April 2023, then cut to £6,000 in 2023/24, and halved again to £3,000 in 2024/25 and onwards. Married couples and civil partners each have their own AEA; transferring assets to a spouse/civil partner before disposal is a common tax planning step.

How does my income affect the CGT rate I pay?

CGT uses the remaining space in your income tax basic-rate band after your taxable income fills it. If your income is £30,000, you have £20,270 (£50,270 − £30,000) of basic-rate band left; gains up to that amount are taxed at 18%, with any excess at 24%. If your income already exceeds the higher-rate threshold, all your gains are taxed at 24%. Enter your taxable income (salary minus personal allowance minus pension etc.) for the most accurate result.

What is Business Asset Disposal Relief (BADR)?

BADR (formerly Entrepreneurs' Relief) is a reduced CGT rate of 18% (2026/27) on gains from selling qualifying business assets, typically a trading company, a partnership, or business assets used in your trade. There is a £1,000,000 lifetime limit across all BADR claims. Qualifying conditions include owning at least 5% of shares and voting rights, and having been an employee or officer of the company for at least two years.

What costs can I deduct from my gain?

You can deduct: (1) the original purchase price (acquisition cost); (2) buying costs: stamp duty, legal fees, surveyor fees; (3) improvement costs: capital expenditure that added value (not repairs or maintenance); (4) selling costs: estate agent fees, legal fees, advertising. You cannot deduct mortgage interest, insurance, or day-to-day maintenance costs.

Tax & Income

Capital Gains Tax Calculator

Calculate CGT on property, shares, and business assets using the latest 2026/27 rates. Covers the £3,000 annual exempt amount and Business Asset Disposal Relief.

Updated April 2026

Your details

Asset type

Sale proceeds

Original purchase price

Other allowable costs (optional)

Legal fees, improvements, selling costs, stamp duty paid on purchase

Your taxable income this year

Used to determine how much basic-rate band remains for CGT

Your results

Capital Gains Tax on a £50,000 Gain

Capital Gains Tax due

£10,364

Taxable gain

£47,000

Gross gain: £50,000
Annual exempt amount: −£3,000
Effective rate: 20.73%

Breakdown

Sale proceeds: £150,000
Less: acquisition cost: −£100,000
Gross gain: £50,000

Basic-rate band available: £15,270

Band	Taxable Amount	Rate	Tax
Basic rate (18%)	£15,270	18%	£2,749
Higher rate (24%)	£31,730	24%	£7,615
Total Capital Gains Tax			£10,364

Related calculators

Income Tax Calculator Stamp Duty Calculator Dividend Tax Calculator

Related guides

Capital Gains Tax Guide

Frequently asked questions

How Capital Gains Tax works in the UK

Capital Gains Tax (CGT) is charged on the profit when you sell or dispose of an asset that has increased in value. It is the gain that is taxed, not the total proceeds. Selling shares for £30,000 that you bought for £20,000 creates a £10,000 gain. After deducting your annual exempt amount, only the remaining gain is taxable.

Rates and the annual exempt amount

For 2026/27 the annual CGT exempt amount is £3,000. Gains below this threshold are tax-free each year. Above the exemption, basic-rate taxpayers pay 18% on property gains and 18% on other assets; higher and additional-rate taxpayers pay 24% on property and 24% on other assets. Gains are added on top of your taxable income to determine which rate applies, so a gain can straddle the basic and higher rate band.

What is exempt from CGT?

Your main home is usually exempt through Private Residence Relief. Assets held in an ISA or pension are completely sheltered from CGT. Gifts between spouses or civil partners do not trigger CGT. Premium Bonds, gilts, and SAYE schemes are also exempt. Selling personal belongings (chattels) for less than £6,000 is exempt; above this, only gains over £6,000 are taxable.

Reducing your CGT bill legally

Use your annual exempt amount each year. It cannot be carried forward, so unused allowance is lost. Bed-and-ISA (selling assets and immediately rebying them inside an ISA) shelters future growth tax-free. Transferring assets to a spouse before sale uses their exempt amount and potentially their lower tax rate. Timing disposals across two tax years can use two years of exempt amount on a large gain.

Sources & methodology

Built and maintained by Tim, a personal finance enthusiast (not a financial adviser). Last reviewed April 2026. Rates and thresholds come from official UK government publications.

HMRC: Income Tax rates and allowances · Official rates, bands and thresholds
GOV.UK: National Insurance rates · Employee and employer NI rates
Scottish Government: Income Tax · Scottish income tax rates and bands
HMRC: Stamp Duty Land Tax · Rates, thresholds and first-time buyer relief
GOV.UK: Capital Gains Tax on property · Property CGT rates and exemptions

Figures are estimates only. This is not financial or tax advice. For help with your specific situation, speak to HMRC or a qualified adviser.