What CGT is — tax on the gain, not the sale
You pay CGT on the increase in value of an asset between buying it and selling (or giving) it away — not on the whole amount you get. Work it out like this:
- Take what you sold it for (or its market value if you gave it away).
- Subtract what you paid for it and your allowable costs — buying/selling fees, and money spent improving it (not normal repairs).
- That’s your gain. Add up all your gains for the year, then take off the £3,000 Annual Exempt Amount. You only pay CGT on what’s left.
The £3,000 is per person, per year
A married couple or civil partners can each use their £3,000 — and gifts between them are exempt, so transferring an asset before a sale can use both allowances. The allowance can’t be carried over to next year if you don’t use it.
What you don’t pay it on
A lot is exempt — which is why CGT never touches most people:
| Exempt | Detail |
|---|
| Your main home | Usually no CGT under Private Residence Relief if it’s been your only/main home throughout. |
| ISAs & pensions | Anything held inside an ISA or pension is outside CGT entirely. |
| Your car | Private cars are exempt. |
| Possessions under £6,000 | Most personal items sold for less than £6,000. |
| Gifts to spouse / charity | Gifts to a husband, wife or civil partner, or to charity, are exempt. |
| Winnings & gilts | Premium Bond, lottery and betting winnings, and UK government gilts. |
The rates — 18% or 24%
For gains made from 6 April 2026, you pay:
- 18% on the part of your gain that falls within your basic-rate Income Tax band;
- 24% on anything above it.
These rates now apply to both property and shares. To find which band your gain sits in, add your taxable gains on top of your taxable income for the year.
Worked example
You sell a second property and make a £20,000 gain. Take off the £3,000 allowance → £17,000 taxable. If you’re a higher-rate taxpayer, that’s taxed at 24% = £4,080, due within 60 days. A basic-rate taxpayer would pay 18% on the part within their band. Business Asset Disposal Relief can lower the rate on qualifying business sales (up to a lifetime limit) — check the current rate, as it has been changing.
How to report & pay
| What you sold | How & when |
|---|
| UK residential property | Report and pay within 60 days of completion, using HMRC’s UK Property Account. |
| Shares & other assets | Report through Self Assessment by 31 January after the tax year, or use HMRC’s “real-time” CGT service. |
Do this now
Before you sell, keep every record — what you paid, what you sold for, and costs like legal fees, estate-agent fees and improvements. They all reduce your gain. For property, diary the 60-day deadline the moment you complete.
CGT can be complex — if there’s a meaningful amount at stake, it’s worth an accountant. Free general money guidance: MoneyHelper. See also Self Assessment and Inheritance Tax.
CGT is UK-wide
Unlike Income Tax, Capital Gains Tax is not devolved — the same rules and rates apply across England, Scotland, Wales and Northern Ireland.