Capital Gains Tax: what you pay it on, rates and allowances
What you pay it on
You pay Capital Gains Tax on the gain when you sell (or ‘dispose of’):
- most personal possessions worth £6,000 or more, apart from your car
- property that’s not your main home
- your main home if you’ve let it out, used it for business or it’s very large
- any shares that are not in an ISA or PEP
- business assets
These are known as ‘chargeable assets’.
If you sell or give away cryptoassets (like cryptocurrency or bitcoin) you should check if you have to pay Capital Gains Tax.
Depending on the asset, you may be able to reduce any tax you pay by claiming a relief.
If you dispose of an asset you jointly own with someone else, you have to pay Capital Gains Tax on your share of the gain.
When you do not pay it
You only have to pay Capital Gains Tax on your total gains above an annual tax-free allowance.
You do not usually pay tax on gifts to your husband, wife, civil partner or a charity.
What you do not pay it on
You do not pay Capital Gains Tax on certain assets, including any gains you make from:
- ISAs or PEPs
- UK government gilts and Premium Bonds
- betting, lottery or pools winnings
When someone dies
When you inherit an asset, Inheritance Tax is usually paid by the estate of the person who’s died. You only have to work out if you need to pay Capital Gains Tax if you later dispose of the asset.
Overseas assets
You may have to pay Capital Gains Tax even if your asset is overseas.
There are special rules if you’re a UK resident but your permanent home is not in the UK.
If you’re abroad
You have to pay tax on gains you make on property and land in the UK even if you’re non-resident for tax purposes.
You do not pay Capital Gains Tax on other UK assets, for example shares in UK companies, unless either:
- you return to the UK within 5 years of leaving
- you sell shares in a company that is ‘UK property rich’ and you meet the conditions for an indirect disposal
A company is UK property rich if 75% or more of the gross asset value of the company is UK land. Find out more about selling or disposing of property and land in the UK to check if you’re making an indirect disposal.