Capital Gains Tax Allowance 2024/25 | What is the Current CGT Rate
How is Capital Gains Tax Charged?
Capital Gains Tax (CGT) is typically levied at a flat rate of 20% on most chargeable gains made by individuals. If a taxpayer’s total income and gains fall within the basic rate band, they may be subject to a reduced rate of 10%. However, if the total income and gains exceed the higher rate threshold, the portion above this threshold will be taxed at 20%.
What are the CGT Rates on Residential Properties?
A higher CGT rate applies to gains from the disposal of residential property, excluding a principal private residence. The rates are 18% for basic rate taxpayers (unchanged from 2023-24) and 24% for higher or additional rate taxpayers (up from 28% in 2023-24). If the gain pushes a taxpayer into the higher rate band, CGT will be applied proportionally.
Are There Other CGT Rates?
For carried interest, which is the share of profits paid to an investment fund manager, the CGT rates remain unchanged: 18% for basic rate taxpayers and 28% for higher or additional rate taxpayers.
When Are CGT Payments Due?
CGT owed to HMRC is generally due by 31 January following the end of the tax year in which the gain was made. However, since 27 October 2021, CGT on the sale of residential property (excluding properties qualifying for Private Residence Relief) must be paid within 60 days of the disposal.
Annual CGT Exemption
The annual CGT exemption for individuals is currently £3,000 (down from £6,000 in 2023-24). This exemption is separate for each spouse or civil partner.
Contact Us
If you need assistance understanding your CGT liabilities or the applicable rates, contact our specialist tax team today. We can help you manage your CGT obligations and ensure you are aware of the rates that apply to you. For more information on how we can assist, reach out to Moore (South) today.