Calculate Your Capital Gains Tax
Your Capital Gains Tax Calculation
Capital Gain
Taxable Gain
CGT Due
Net Proceeds
Detailed Breakdown
Understanding Capital Gains Tax on Property
CGT Rates
- Basic rate taxpayers: 18% on property gains
- Higher/additional rate taxpayers: 28% on property
- Rates apply to residential property disposals
- Different rates for other assets (10%/20%)
- Rates subject to change in budget announcements
Allowances & Reliefs
- Annual exemption: £6,000 for 2023-24
- Principal private residence relief available
- Letting relief for some circumstances
- Business asset disposal relief possible
- Indexation allowance for pre-1998 purchases
Allowable Costs
- Original purchase price and legal costs
- Stamp duty and survey fees
- Capital improvements and extensions
- Sale costs including agent and legal fees
- Advertising and marketing expenses
Payment & Deadlines
- Report disposal within 60 days of completion
- Pay capital gains tax within 60 days
- Include in annual self-assessment return
- Interest charged on late payments
- Penalties apply for late reporting
Frequently Asked Questions
Essential information about capital gains tax on UK property investments
What is the current capital gains tax rate on property in the UK?
For the 2023-24 tax year, capital gains tax on residential property is 18% for basic rate taxpayers and 28% for higher and additional rate taxpayers. These rates apply to the taxable gain after deducting the annual exemption and allowable costs.
What costs can I deduct when calculating capital gains tax?
Allowable costs include the original purchase price, legal fees, stamp duty, survey costs, capital improvements (not repairs), sale costs including estate agent fees, legal fees for the sale, and advertising costs. Regular maintenance and repairs cannot be deducted.
Do I need to pay capital gains tax on my main residence?
Generally no, your main residence is exempt from capital gains tax under Principal Private Residence Relief. However, if you've let out part of the property, used it for business, or it's very large (over 5,000 square metres), some CGT may apply. Second homes and investment properties are subject to CGT.
When do I need to report and pay capital gains tax?
You must report the disposal and pay any CGT due within 60 days of completion (formerly 30 days). This is done through the UK property disposal service online. You must also include the disposal in your annual self-assessment tax return. Penalties apply for late reporting and payment.
Can I reduce my capital gains tax liability legally?
Yes, several strategies can help: utilize your annual CGT allowance, consider transferring assets to a spouse, time disposals across tax years, ensure all allowable costs are claimed, consider business asset disposal relief if applicable, and seek professional tax advice for complex situations involving multiple properties or business use.