Capital Gains Tax (CGT) is payable on the value of any gain over the annual exemption of £11,300 (for tax year 2017/18) except for gains in ISA or Pension Tax Wrappers.
Gains on the sale of a main residence are exempt.
The charge is 10% for Basic Rate Tax payers or 20% for Higher Rate Tax payers on all gains except those made on the sale of a second property.
The charge on second property gains is 18% or 28% respectively.
The gain is added to your current total income to see whether this takes you over the High Rate Personal Tax Allowance threshold. If it does, then the higher rate is applied.
For investments, outside of the above tax wrappers, CGT planning should take place each year to reset the clock to zero and use up that year's annual exemption.
There are ways of deferring CGT until death and CGT dies with you.
EJ FINANCIAL LTD
2nd Floor • Johnsons Building • The Broadway • Crowborough • East Sussex • TN6 1DE
01892 234884 • 020 3657 9079 • 01635 777795
EJ Financial Ltd. Registered in England and Wales No 9370740
Authorised and regulated by the Financial Conduct Authority. We are entered on the Financial Services Register No 670594 at www.fsa.gov.uk/register.
The Financial Conduct Authority does not regulate taxation and trust advice.
The value of your investment can go down as well as up and you may get back less than you have invested.
The information contained within the website is subject to the UK regulatory regime and is therefore primarily targeted at customers in the UK.
NOTE: None of the above constitutes advice, always consult a professional adviser before making any investment decisions.
Please talk to Ted on 01892 234884 or 01635 777795 for further information.
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