Capital Gains Tax

Summary

A tax on the sale or gift of a chargeable asset.
Annual exemption for each individual in 2008 / 09 is £9,600.
An individual's assets on death are not liable to CGT.
Some assets are exempt; for example, stocks and shares held in ISAs, National Savings Certificates, Premium Bonds, Child Trust Funds, cars, and personal possessions worth up to £6,000.
Principal Private Residence (PPR) relief exempts gains arising on the sale of a property that has been the taxpayer's only or main residence.
Tax is due on January 31st following the end of the tax year in which gain arose.
It must be reported to HM Revenue & Customs if the gain exceeds annual exemption.
Since April 2008, CGT is charged at a flat rate of 18% on gains above your personal allowance.
Entrepreneur's relief on the disposal of certain business assets brings the CGT rate charged down to 10% on gains up to a lifetime limit of £1 million.
Gifts between husband and wife or civil partners defer the CGT until subsequent disposal.
Assets disposed of to a charity, museum or art gallery are free from CGT.
A person must be resident or ordinarily resident in the UK, or be a temporary non-resident, for a CGT charge to arise.

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