CGT rates for 2025/26 — what changed

The October 2024 Autumn Budget made the biggest single-year change to CGT in decades. From 30 October 2024, the rates on shares, crypto, and most other assets were raised from 10%/20% to 18%/24%, aligning them with residential property rates. The separate property premium is gone — all assets now use the same two rates.

Asset typeBasic rate taxpayerHigher rate taxpayerNotes
Residential property18%24%60-day rule
Shares, funds, ETFs18%24%Unified since Oct 2024
Crypto assets18%24%Each swap is a disposal
Business assets (BADR)14% flat rateRising to 18% Apr 2026
Annual Exempt Amount£3,000Down from £12,300 in 2022/23

Band-stretching — the calculation most calculators get wrong

CGT is not calculated in isolation. Your gains are added on top of your taxable income to determine which rate applies. This means a basic-rate taxpayer with a large gain may pay 18% on the portion that keeps them within the basic-rate band, and 24% on the portion that spills into the higher-rate band.

Example — band-stretching in action

Sarah earns £38,000 per year. Her taxable income after the £12,570 personal allowance is £25,430. She sells shares and makes a gain of £30,000. After the £3,000 annual exemption, her taxable gain is £27,000.

The basic-rate band runs to £37,700 of taxable income. She’s already used £25,430 of it, leaving £12,270 of basic-rate band for her gains. So £12,270 of the gain is taxed at 18% (= £2,208.60), and the remaining £14,730 at 24% (= £3,535.20). Total CGT: £5,743.80.

A calculator that simply asked “are you a basic or higher-rate taxpayer?” would have got this wrong.

The £3,000 annual exempt amount

Every individual can make up to £3,000 of capital gains each tax year completely free of CGT. This is applied after losses and before rates are applied. It cannot be carried forward — if you don’t use it, you lose it. If you own assets jointly with a spouse or civil partner, you each get your own £3,000 allowance, effectively doubling it to £6,000.

The AEA has fallen sharply: it was £12,300 in 2022/23, £6,000 in 2023/24, and £3,000 from 2024/25 onwards. This means far more disposals now result in a tax liability than before.

Property: the 60-day reporting deadline

If you sell UK residential property and owe CGT, you must report and pay within 60 days of completion using HMRC’s online Real Time Capital Gains Tax Service. This applies to buy-to-let properties, second homes, and inherited property — not your main home (which is covered by Private Residence Relief).

Missing the 60-day deadline results in an automatic £100 penalty, with further penalties for delays beyond 6 and 12 months. The 60-day clock starts from the completion date, not exchange. For other assets (shares, crypto), you report through Self Assessment by 31 January after the tax year ends.

What counts as an allowable cost for property?

You can deduct: the original purchase price, Stamp Duty Land Tax paid on purchase, legal and conveyancing fees (both purchase and sale), estate agent fees on sale, and the cost of capital improvements (extensions, loft conversions, new kitchens/bathrooms that add value — not repairs or maintenance). You cannot deduct mortgage interest, contents, or normal maintenance costs.

Business Asset Disposal Relief (BADR)

BADR — formerly Entrepreneurs’ Relief — allows qualifying business owners to pay a reduced CGT rate on the first £1 million of lifetime gains from business disposals. The rate is currently 14% (from 6 April 2025), rising to 18% from April 2026.

To qualify you must, for at least 2 years up to the disposal date: hold at least 5% of the shares and voting rights in a trading company, and be an employee or director of that company. The business must be a trading company (not primarily an investment company). BADR is claimed on your Self Assessment tax return.

Private Residence Relief — selling your home

Your main home is exempt from CGT in most circumstances through Private Residence Relief (PRR). The full relief applies if you’ve lived in the property as your main home for the entire period of ownership. If you’ve had periods of non-occupation (e.g. you let it out, worked away, or it was empty), only a proportion of the gain is exempt.

The final 9 months of ownership always qualify for relief regardless of occupation — reduced from 18 months before April 2020. If you have two properties, you can elect which one is your main home, but the election must be made within 2 years of acquiring the second property.

Frequently asked questions

Do I pay CGT on crypto?
Yes. HMRC treats cryptocurrency as a capital asset. CGT applies when you sell crypto for GBP, exchange one crypto for another, use crypto to pay for goods or services, or give crypto away (gifting counts as a disposal at market value). The rates are the same as shares: 18% for basic-rate taxpayers, 24% for higher-rate, with the £3,000 annual exemption applying. HMRC uses the “same-day” and “30-day” anti-bed-and-breakfasting rules for crypto, then the Section 104 pool for older holdings. You must keep records of every transaction including the sterling value at the time.
Can I transfer assets to my spouse to reduce CGT?
Yes — transfers between spouses and civil partners are “no gain, no loss” disposals, meaning no CGT is triggered on the transfer. Your spouse takes over the asset at your original cost, but they then benefit from their own £3,000 annual exemption and their own basic-rate band when they eventually sell. This is one of the most effective legal CGT planning strategies available, particularly for assets where a large gain has built up over time.
What is bed-and-breakfasting and why can’t I use it?
Bed-and-breakfasting was a strategy where investors sold shares to crystallise a loss (or use their annual exemption) and immediately rebought them the next day. HMRC blocked this with the “30-day rule”: if you sell shares and buy the same shares within 30 days, the repurchase is matched against the sale for CGT purposes, nullifying any gain or loss. The same rule applies to crypto. You can still achieve the same effect by waiting 31 days before rebuying, or by buying the same asset inside an ISA (where no CGT applies).
Do I need to report gains even if no tax is due?
Possibly. For shares and other non-property assets, you must report on Self Assessment if your total disposal proceeds in the year exceed £50,000 (four times the AEA) — even if the gains are fully covered by the exemption. For property, you must use the 60-day reporting service for any residential property sale where CGT is due, regardless of amount. If gains are within the £3,000 AEA and total proceeds are under £50,000, no reporting is required — but you should still keep records in case HMRC asks.
Can losses be carried forward?
Yes. If your allowable losses exceed your gains in a tax year, the excess can be carried forward indefinitely. Losses must be offset against gains in the current year first, but you only need to use enough brought-forward losses to reduce net gains to the £3,000 AEA — you don’t have to use all your losses in one year. You must formally report losses to HMRC within 4 years of the end of the tax year in which the loss arose, even if there are no gains to offset them against.
Is CGT due on inherited assets?
No CGT is triggered when you inherit an asset — it passes at the market value on the date of death (this is called the “probate value” or “date of death value”). If the estate is large enough, Inheritance Tax may be payable by the estate. When you eventually sell the inherited asset, CGT is calculated on the gain from the probate value to your sale price, not from the original purchase price. This “uplift” to market value at death means inherited assets often have little or no embedded CGT gain immediately after inheritance.