Capital Gains Tax

Capital Gains Tax (CGT) applies when an individual sells or transfers ownership of an asset to another entity, be it a trust, company or individual.

A charge only applies where the value of the asset, at the time it is to be sold, exceeds the value at which it was acquired. CGT still applies when an asset is gifted or given away other than gifts between spouses.

Our specialist team will assist you in quantifying any capital gain tax liability, minimising any liability and making appropriate use of deferal reliefs.

There are certain exemptions and tax reliefs available which can reduce the amount of the chargeable gain. The following exemptions have a broad application.

CGT Planning

Pre transaction planning may enable CGT to be minimised and wealth preserved. The following are options to be considered:

  • taper relief: this reduces the effective tax rate based on the length of ownership. There is both business and non-business relief.
  • roll over relief: applicable generally to traders who dispose of qualifying business assets and aquire new qualifying business assets
  • gift holdover relief: for some assets this relief defers the charge to CGT
  • Enterprise Investment Scheme is given CGT taper relief opportunities

We offer a creative and proactive approach to CGT planning which includes bespoke planning in relation to your personal circumstances.

Be warned! In his 2007 pre-budget report the Chancellor announced that taper relief on Capital Gains would be withdrawn and a flat rate of Capital Gains Tax charged at 18%. This regime comes into effect on 6 April 2008. If you wish to discuss possible planning measures which can be taken before 6 April 2008, please contact our tax team.



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