How capital gains tax works in United Kingdom
UK capital gains tax applies when individuals dispose of chargeable assets such as shares, funds, second homes, cryptoassets and other investment assets. Your income tax band helps determine the rate.
From 6 April 2026, gains are charged at 18% for basic-rate taxpayers and 24% for higher and additional-rate taxpayers. Trustees and personal representatives generally pay 24%, and Business Asset Disposal Relief is 18% from the same date.
The annual exempt amount is GBP 3,000. Main homes are often exempt under private residence relief, but business use, letting and non-UK residence can change the result.
Tax rates at a glance
- Annual exempt amount
- GBP 3,000
- Basic rate CGT
- 18%
- Higher and additional rate CGT
- 24%
- Business Asset Disposal Relief
- 18%
Who benefits most
These profiles tend to benefit most when the rules match their real residence, payroll and business setup.
ShareholdersInvestorsLandlordsCrypto holdersBusiness owners
Watch out for
- Business Asset Disposal Relief rose to 18% for disposals on or after 6 April 2026.
- Carried interest received from 6 April 2026 is taxed as income and subject to National Insurance contributions instead of CGT.
- Losses, residence status and asset type can change the effective rate, especially for property and business disposals.
Frequently asked questions
What is the UK capital gains tax rate?
For most individuals in 2026/27, the rate is 18% if you are a basic-rate taxpayer and 24% if you are a higher or additional-rate taxpayer.
Is there an annual CGT allowance?
Yes. The annual exempt amount is GBP 3,000 for 2026/27.
Are UK homes taxed on capital gains?
Usually no, if the property qualifies as your main home. However, letting, business use or an overseas residence position can create taxable gains.