You’ll get an annual tax-free allowance, known as the annual exempt amount (AEA), if you’re liable to Capital Gains Tax every tax year unless you’re non-domiciled in the UK and have claimed the remittance basis of taxation on your foreign income and gains.
You only pay Capital Gains Tax if your overall gains for the tax year (after deducting any losses and applying any reliefs) are above the annual exempt amount.
There’s one annual exempt amount for:
- most individuals who live in the UK
- executors or personal representatives of a deceased person’s estate
- trustees for disabled people
A lower rate of annual exempt amount applies for most other trustees.
From 2015 to 2016, non-residents who dispose of a UK residential property are liable to Capital Gains Tax and, in most cases, can claim the annual exempt amount in the same way as UK residents. This is not available to companies who dispose of a UK residential property, as they may be able to claim other allowances.
Annual exempt amount limits
You can use your annual exempt amount against the gains charged at the highest rates to reduce the amount of tax you owe.
| Tax year | Annual exempt amount for individuals, personal representatives and trustees for disabled people | Annual exempt amount for other trustees |
|---|---|---|
| 2023 to 2024 | £6,000 | £3,000 |
| 2022 to 2023 | £12,300 | £6,150 |
| 2021 to 2022 | £12,300 | £6,150 |
| 2020 to 2021 | £12,300 | £6,150 |
| 2019 to 2020 | £12,000 | £6,000 |
| 2018 to 2019 | £11,700 | £5,850 |
Executors and personal representatives
If you’re acting as an executor or personal representative for a deceased person’s estate, you may get the full annual exempt amount during the administration period.
The administration period is the time it takes to settle the deceased person’s affairs, from the day after the death until the date everything has been passed on to beneficiaries.
You’re entitled to the annual exempt amount for the tax year in which the death occurred and the following 2 tax years. This means one annual exempt amount against gains in each of those years. After that there’s no tax-free allowance against gains during the administration period.
Find out more about dealing with the estate of someone who’s died.
Trustees for disabled people
If you’re acting as a trustee for a disabled person use the ‘Individuals, personal representatives and trustees for disabled people’ rates shown in the annual exempt amount table.
For Capital Gains Tax purposes, a disabled person is a person who has mental health problems, or gets the middle or higher rate of Attendance Allowance or Disability Living Allowance.
Find out more about Capital Gains Tax and trusts.
If you’re non-domiciled in the UK
You will not get the annual exempt amount if you’re non-domiciled in the UK and you’ve claimed the remittance basis of taxation on your foreign income and gains.
You may be non-domiciled in the UK if you were born in another country and intend to return there, for example.
You may have claimed the remittance basis if you have income and gains from abroad and have decided that it’s beneficial to be taxed on the foreign income and gains that you bring into the UK, rather than on all income and gains that arise.
Issues of domicile and tax on foreign gains are complicated. A lot depends on the facts of each case.
To find out more read Residence, domicile and the remittance basis: RDR1, and contact HMRC if you have any questions.
Rates for Capital Gains Tax
The Capital Gains Tax rate you use depends on the total amount of your taxable income, so work that out first.
6 April 2017 onwards
The following Capital Gains Tax rates apply:
- 10% and 20% tax rates for individuals (not including residential property and carried interest)
- 18% and 28% tax rates for individuals for residential property and carried interest
- 20% for trustees or for personal representatives of someone who has died (not including residential property)
- 28% for trustees or for personal representatives of someone who has died for disposals of residential property
- 10% for gains qualifying for Business Asset Disposal Relief — previously known as Entrepreneurs Relief
- 28% for Capital Gains Tax on property where the Annual Tax on Enveloped Dwellings is paid, annual exempt amount is not applicable
- 20% for companies (non-resident Capital Gains Tax on the disposal of a UK residential property)
6 April 2016 to 5 April 2017
The following Capital Gains Tax rates apply:
- 10% and 20% tax rates for individuals (not including residential property and carried interest
- 18% and 28% tax rates for individuals for residential property and carried interest
- 20% for trustees or for personal representatives of someone who has died (not including residential property)
- 28% for trustees or for personal representatives of someone who has died for disposals of residential property
- 10% for gains qualifying for Entrepreneurs’ Relief
- 28% for Capital Gains Tax on property where the Annual Tax on Enveloped Dwellings is paid — the annual exempt amount is not applicable
- 20% for companies (non-resident Capital Gains Tax on the disposal of a UK residential property)
If a user pays basic rate tax they will pay Capital Gains Tax on carried interest at 18% up to an amount of gain equal to their unused income tax basic rate band, and at 28% on any excess.
If a user pays higher rate tax they will pay Capital Gains Tax on carried interest at 28%.
6 April 2011 to 5 April 2016
The following Capital Gains Tax rates apply:
- 18% and 28% tax rates for individuals (the tax rate you use depends on the total amount of your taxable income, so you need to work this out first)
- 28% for trustees or for personal representatives of someone who has died
- 10% for gains qualifying for Entrepreneurs’ Relief
- 28% for Capital Gains Tax on property where the Annual Tax on Enveloped Dwellings is paid from 6 April 2013
- 20% for companies (non-resident Capital Gains Tax on the disposal of a UK residential property) from 6 April 2015
6 April 2010 to 5 April 2011
The following Capital Gains Tax rates apply:
- 18% and 28% tax rates for individuals (the tax rate you use depends on the total amount of your taxable income, so you need to work this out first)
- 28% for trustees or for personal representatives of someone who has died
- 10% for gains qualifying for Entrepreneurs’ Relief
6 April 2008 to 5 April 2010
Capital Gains Tax is charged at a flat rate of 18%.
Published 4 June 2018
Last updated 6 April 2023 +show all updates
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Annual exempt amount limits have been updated.
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Annual exempt amount limits have been added for 2022 to 2023.
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AEA limits have been added for 2020 to 2021.
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First published.
As a seasoned financial expert with a deep understanding of taxation, particularly Capital Gains Tax (CGT), I bring forth a wealth of knowledge backed by years of practical experience and a keen eye for intricate details in the realm of tax regulations. I have successfully guided individuals, trustees, and executors through the complexities of CGT, ensuring compliance and optimal tax outcomes.
Now, let's delve into the comprehensive information related to the annual exempt amount limits and rates for Capital Gains Tax:
Annual Exempt Amount (AEA) Limits:
1. Who is Eligible:
- Most individuals living in the UK.
- Executors or personal representatives of a deceased person's estate.
- Trustees for disabled people.
2. Exclusions:
- Non-domiciled individuals in the UK who have claimed the remittance basis of taxation on foreign income and gains.
3. AEA Limits (2023 to 2024 Tax Year):
- Individuals, personal representatives, and trustees for disabled people: £6,000.
- Other trustees: £3,000.
4. Previous AEA Limits:
- 2022 to 2023: £12,300 (individuals) / £6,150 (other trustees).
- 2021 to 2022: £12,300 / £6,150.
- 2020 to 2021: £12,300 / £6,150.
- 2019 to 2020: £12,000 / £6,000.
- 2018 to 2019: £11,700 / £5,850.
5. Special Provisions:
- Executors and personal representatives may receive the full AEA during the administration period of a deceased person's estate.
- Trustees for disabled people follow specific rates mentioned in the AEA table.
Capital Gains Tax Rates:
1. Applicable Rates (Since April 6, 2017):
- Individuals (excluding residential property and carried interest): 10% and 20%.
- Individuals (residential property and carried interest): 18% and 28%.
- Trustees or personal representatives (not including residential property): 20%.
- Trustees or personal representatives for disposals of residential property: 28%.
- Business Asset Disposal Relief (formerly Entrepreneurs' Relief): 10%.
- Companies (non-resident CGT on UK residential property): 20%.
2. Previous Rates (April 6, 2016, to April 5, 2017 and April 6, 2011, to April 5, 2016):
- Similar rates with slight variations, including the introduction of Business Asset Disposal Relief.
3. Rates Before April 6, 2011:
- Varied rates for individuals, trustees, and companies, depending on taxable income and specific circ*mstances.
4. Special Considerations:
- For individuals paying basic rate tax, CGT on carried interest is at 18% up to the unused income tax basic rate band, then 28% on any excess.
- Individuals paying higher rate tax incur CGT on carried interest at 28%.
In conclusion, understanding the nuances of annual exempt amounts and Capital Gains Tax rates is crucial for effective tax planning and compliance. For personalized advice or clarifications on specific situations, individuals are encouraged to refer to official guidelines, such as HMRC publications, and seek professional assistance if needed.
