You only have to pay Capital Gains Tax on your overall gains above your tax-free allowance (called the Annual Exempt Amount).
The Capital Gains tax-free allowance is £11,700 for 2018/19 and £12,000 for 2019/20.
Gifts to your spouse or charity
There are special rules for Capital Gains Tax on gifts or assets you dispose of to:
- Your spouse or civil partner
Your spouse or civil partner
You do not pay Capital Gains Tax on assets you give or sell to your husband, wife or civil partner.
Your spouse or civil partner may have to pay tax on any gain if they later dispose of the asset.
Their gain or loss will be calculated from when you or they first owned it.
Gifts to charity
You do not have to pay Capital Gains Tax on assets you give away to charity.
You may have to pay if you sell an asset to charity for both:
- more than you paid for it
- less than market value
Work out your gain using the amount the charity actually pays you, rather than the value of the asset.
Gift holdover relief
You may be able to claim Gift Hold-Over Relief if you give away business assets (including certain shares) or sell them for less than they’re worth to help the buyer.
Gift Hold-Over Relief means:
- you do not pay any Capital Gains Tax when you give away the assets
- the person you give them to pays Capital Gains tax (if any is due) when they sell them
- be a sole trader or business partner, or have at least 5% of voting rights in a company (known as your ‘personal company’)
- use the assets in your business or personal company
You can usually get partial relief if you used the assets only partly for your business.
You do not pay Capital Gains Tax on any assets you give away.
You might need to pay tax if you:
- sell an asset for less than it’s worth to help the buyer
- make a gain on what you paid for it
Using losses to reduce your gain
When you report a loss, the amount is deducted from the gains you made in the same tax year.
If your total taxable gain is still above the tax-free allowance, you can deduct unused losses from previous tax years. If they reduce your gain to the tax-free allowance, you can carry forward the remaining losses to a future tax year.