When is Capital Gains Tax payable

Notwithstanding any of the comments that follow, an individual is allowed to make tax-free capital gains of £11,700 during 2018-19.

There are also a number of circumstances when a disposal does not create a taxable gain. These include:

  • The sale of personal assets worth less than £6,000.
  • Gifts to your spouse or civil partner.
  • Gifts to a charity.
  • Gains when you cash in ISAs or PEPs.
  • Disposal of certain UK government gilts and premium bonds.
  • Betting, lottery or pools winnings.
  • Any personally owned car.

If you live abroad, you will have to pay tax on gains you make on residential property in the UK even if you are non-resident for tax purposes. You do not pay Capital Gains Tax on other UK assets, for example shares in UK companies, unless you return to the UK within 5 years of leaving.

Even if gains are taxable there may be reliefs you can claim to reduce or defer any Capital Gains Tax that may be due. These reliefs include:

  • Entrepreneurs’ relief
  • Business asset rollover relief
  • Incorporation relief
  • Gift hold-over relief

Circumstances when these reliefs may be of use include:

  • When you sell your business
  • When you reinvest the proceeds from a chargeable disposal into a new asset
  • When you change a sole trader or partnership business into a limited liability company, and
  • If you give away a business asset.

If you are likely to dispose of, or re-organise, any assets in this way please contact us to discuss any Capital Gains Tax implications.

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