Capital Gains Tax Rates 2025-26
Full guide to Capital Gains Tax for 2025-26: rates, annual exempt amount, and step-by-step calculation examples.
CGT Rates 2025-26
Following the October 2024 Autumn Budget, CGT rates on shares were increased to match residential property rates. Both asset types now share the same rates from 30 October 2024 onwards.
| Asset Type | Basic Rate Taxpayer | Higher / Additional Rate Taxpayer |
|---|---|---|
| Shares & most assets | 18% | 24% |
| Residential property (not main home) | 18% | 24% |
| Business Asset Disposal Relief | 14% (rising to 18% from April 2026) | |
| Main residence | 0% (Private Residence Relief) | |
Note: before 30 October 2024, shares and other non-property assets attracted 10% (Basic) and 20% (Higher). The Autumn Budget raised these to 18%/24%. Residential property rates had been 18%/28% — the Higher Rate was reduced to 24%.
Annual Exempt Amount (AEA) — Historical Context
| Tax Year | Annual Exempt Amount |
|---|---|
| 2025-26 | £3,000 |
| 2024-25 | £3,000 |
| 2023-24 | £6,000 |
| 2022-23 | £12,300 |
| 2021-22 | £12,300 |
The AEA has been cut dramatically. At £3,000, even modest investors selling shares will often incur CGT. Using your annual ISA allowance (£20,000) to shelter gains is more important than ever.
How CGT is Calculated
- Calculate the gain: Sale proceeds − acquisition cost − allowable costs (solicitor fees, improvements for property)
- Deduct the Annual Exempt Amount: £3,000 offset
- Stack the gain on top of income: Add taxable gain to your income to see which rate applies
- Apply the rate: 18% if the gain falls in the Basic Rate band, 24% if it falls in Higher or Additional Rate
Worked Examples
Example 1: £15,000 gain on shares, Basic Rate taxpayer (salary £35,000)
- Gain: £15,000
- Less Annual Exempt Amount: −£3,000
- Taxable gain: £12,000
- Salary £35,000 uses Basic Rate band up to £50,270. Remaining Basic Rate band: £50,270 − £35,000 = £15,270
- Taxable gain £12,000 falls within Basic Rate band → CGT at 18% = £2,160
Example 2: £40,000 gain on shares, Higher Rate taxpayer (salary £60,000)
- Gain: £40,000
- Less AEA: −£3,000
- Taxable gain: £37,000
- Salary £60,000 already exceeds Higher Rate threshold — entire gain is in the Higher Rate band
- CGT at 24% = £8,880
Example 3: £50,000 gain on a buy-to-let property, salary £45,000
- Gain: £50,000
- Less AEA: −£3,000
- Taxable gain: £47,000
- Basic Rate band remaining: £50,270 − £45,000 = £5,270 (of gain falls here at 18%)
- Remaining: £47,000 − £5,270 = £41,730 falls in Higher Rate band at 24%
- CGT = (£5,270 × 18%) + (£41,730 × 24%) = £948.60 + £10,015.20 = £10,963
Private Residence Relief (Main Home)
Your main home is exempt from CGT under Private Residence Relief, provided it was your main residence for the entire ownership period. If you lived in it for part of the time only, PRR applies proportionally plus the final 9 months of ownership always qualify. Lettings Relief (up to £40,000) may apply if you let part of your main home.
Bed & ISA Strategy
To crystallise gains within your annual exempt amount while protecting future growth from CGT, consider a "Bed & ISA" operation: sell the holding outside the ISA (using up to £3,000 of AEA), then repurchase the same shares inside a Stocks & Shares ISA. Future gains and dividends within the ISA are then completely tax-free.
Share Matching Rules
HMRC applies specific identification rules to prevent "bed and breakfasting" (selling and immediately repurchasing to use the AEA). Disposals are matched in this order:
- Same-day acquisitions
- Acquisitions within the following 30 days (the "30-day rule")
- Earlier acquisitions in chronological order (the "pool")
Related Calculators
- Capital Gains Tax calculator (shares & property)
- Dividend tax rates 2025-26
- £60,000 after tax (to check your income tax band)
Frequently Asked Questions
What is the Capital Gains Tax rate for 2025-26?
CGT rates for 2025-26 are 18% (Basic Rate taxpayers) and 24% (Higher and Additional Rate taxpayers) on both shares and residential property. These rates were unified in the October 2024 Budget. Business Asset Disposal Relief is taxed at 14% (rising to 18% from April 2026).
What is the CGT Annual Exempt Amount in 2025-26?
The Annual Exempt Amount is £3,000 in 2025-26 — unchanged from 2024-25. This means you can make total capital gains of up to £3,000 in the year without paying CGT. The AEA has been cut substantially since the £12,300 figure that applied until 2022-23.
Do I have to pay CGT on my main home?
No. Your main home benefits from Private Residence Relief and is exempt from CGT, provided it was your sole or main residence throughout your ownership. If you rented it out or moved away at any point, a proportion of the gain may be taxable.
How is Capital Gains Tax calculated?
Gain = sale price minus original cost minus allowable costs. Deduct the £3,000 annual exempt amount. Add the remaining taxable gain to your income. If it falls in the Basic Rate band (income + gain below £50,270), CGT is 18%. If it falls in Higher or Additional Rate territory, CGT is 24%.