Capital Gains Tax Estimator (UK)

How CGT works in the UK

Capital Gains Tax is charged on the profit (the gain) you make when you dispose of a chargeable asset — not the total proceeds. A disposal includes selling, gifting, swapping or transferring ownership. The tax is calculated per tax year, with each individual entitled to an annual exempt amount before any CGT is due.

For 2026/27 the annual exempt amount is £3,000. This was cut from £6,000 in 2024/25 and from £12,300 in 2022/23, making careful planning increasingly important for investors and landlords.

CGT is paid by individuals, trustees and personal representatives. Companies pay Corporation Tax on their capital gains instead. Losses in the same tax year are offset against gains before the exempt amount is applied; unused losses carry forward indefinitely.

CGT rates for 2026/27

The rate you pay depends on which income tax band you fall into and the type of asset disposed of. Gains are added on top of your taxable income to determine the applicable rate.

Residential property CGT rates were revised in April 2024: the higher rate dropped from 28% to 24%, while the basic rate remained at 18%. Shares, crypto, business assets, and most other assets attract 10% (basic-rate taxpayer) or 20% (higher/additional-rate taxpayer).

What counts as a capital gain

Almost any asset you own personally can be subject to CGT when you dispose of it. Common chargeable assets include: shares and investment funds (held outside an ISA or SIPP), cryptocurrency, second homes and buy-to-let property, business assets, jewellery and art worth over £6,000, and personal possessions (chattels) sold for more than £6,000.

Key assets that are exempt from CGT: your only or main home (under principal private residence relief), ISAs and SIPPs, UK government gilts, personal car (even if it appreciates), lottery and gambling winnings, and foreign currency held for personal use.

The gain is calculated as: Sale proceeds minus allowable costs. Allowable costs include the original purchase price, buying and selling fees, Stamp Duty Land Tax paid on purchase, and the cost of improvements (not repairs) made to the asset.

Common chargeable assets

• Shares and unit trusts held outside ISA/SIPP
• Cryptocurrency (treated as a capital asset since HMRC guidance 2019)
• Residential buy-to-let or second homes
• Commercial property
• Business interests and goodwill
• Antiques, jewellery and art over £6,000
• Foreign currency (business use)

CGT on property: key rules

Residential property CGT is the most complex area. The principal private residence (PPR) relief exempts the gain on your main home in full — you must have lived in it throughout the period of ownership (with some final-period exceptions).

For buy-to-let and second properties, you must report and pay CGT within 60 days of completion using HMRC's UK Property Reporting service. Failing to do so incurs automatic penalties and interest. This 60-day rule has applied since October 2021.

Lettings relief no longer applies broadly — it is now only available if the landlord shares the property with the tenant. Divorce and separation have specific CGT rules: transfers between spouses are at no gain/no loss up to 3 years after the end of the year of separation (extended by Finance Act 2023).

The annual exempt amount of £3,000 applies per person, so a couple jointly owning a buy-to-let can each use their own exemption, doubling the effective tax-free amount to £6,000.

Reducing your CGT bill legally

There are several HMRC-approved ways to reduce or defer CGT. The most impactful are bed-and-ISA (selling shares and rebuying inside an ISA), spousal transfers, and utilising Business Asset Disposal Relief.

Bed-and-ISA: Sell shares outside your ISA to crystallise gains within your annual exempt amount (£3,000), then repurchase inside an ISA. Future gains and dividends are then sheltered from tax entirely.

Spousal/civil partner transfers: Gifts between spouses are CGT-free (no gain/no loss). This allows shifting assets to a spouse in a lower tax bracket before sale, potentially halving the effective CGT rate.

Business Asset Disposal Relief (BADR): Formerly Entrepreneurs' Relief. Qualifying disposals of business interests (sole trader business, partnership share, or personal company shares) attract CGT at just 10% on the first £1 million of lifetime gains. The rate increased from 10% to 14% from April 2025 and to 18% from April 2026 — check current guidance.

Pension contributions: Paying into a pension can reduce your adjusted net income, potentially keeping you in the basic-rate band so a lower CGT rate applies.

Loss harvesting: Intentionally realising losses in a tax year to offset against gains. Losses must first offset same-year gains; any excess carries forward.

Key CGT reduction strategies

• Use your £3,000 annual exempt amount every year — it cannot be carried forward
• Bed-and-ISA: sell and rebuy inside an ISA for future tax-free growth
• Transfer assets to a lower-earning spouse before disposal
• Claim Business Asset Disposal Relief on qualifying business sales
• Make pension contributions to reduce your income band
• Harvest losses before 5 April to offset gains in the same year
• Consider Enterprise Investment Scheme (EIS) deferral relief

How to report and pay CGT

How you report CGT depends on the asset type and the size of the gain.

For UK residential property: use the HMRC UK Property Reporting Service online within 60 days of completion. You must estimate the CGT owed and pay it at that point, then reconcile through self-assessment later in the year.

For other assets (shares, crypto, etc.): report through self-assessment. The deadline for 2026/27 gains is 31 January 2028 for online returns. You pay CGT alongside any income tax balance.

If your total gains after losses are within the £3,000 annual exempt amount and you have no other self-assessment obligations, you may not need to file a return at all — but HMRC recommends keeping records in case of enquiry.

Record-keeping: Keep records of purchase prices, disposal proceeds, improvement costs and any relief claims for at least 6 years after the relevant tax year.