Tax Year End Planning Ahead of Budget Capital Gains Tax

We have reminded users many times across this website that Capital Gains Tax rates and CGT free allowances are perhaps the easiest to change within a Budget.  That said, whilst we are urgng you to make use of your CGT allowances and currently lower rates early, we cannot see it being likely that any changes happen before 6^th April 2026.

We suggest, it is use it or lose it time.

CGT Allowances Have Fallen Dramatically

• Tax Year 2020/21 – 2022/23 = CGT Allowance £12,300.
• Tax Year 2023/24 = CGT Allowance cut to £6,000.
• Tax Year 2024/25 – 2025/26 = CGT Allowance cut to just £3,000.
• Next Tax Year 2026/27 = CGT Allowance cut to £???  - possibly £0?  This would be very easy for the Chancellor to action.

Capital Gains Tax Rates on Chargeable Gains

• 18% for Basic Rate Taxpayers
• 24% for Higher Rate Taxpayers (it was not so long ago that this rate was 28% for property gains)
• 14% under Business Assets Disposal Relief (formerly Entrepreneurs Relief and formerly just 10%).
• It is known ‘territory’ for CGT rates to be the same as income tax rates in the past.
• Next Tax Year 2026/27 = CGT rates increased to income tax rates again Business Assets Disposal Relief rates increased to 20%? This again would be very easy for the Chancellor to action.

Action Before Autumn Budget 2025

Whilst we do not think there will be any major changes to the above on 26^th November (Budget Day), there is always the chance that changes could be made that take effect on 6 April 2026.

• Make sure you have used your CGT allowances where possible in 2025/26.
• Consider taking taxable gains too at 18%, 24% and 14%?  Would you be better taking taxable gains at known rates just in case CGT rates of tax do increase?  

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