By continuing your visit to this site, you accept the use of cookies. They ensure the proper functioning of our services and display relevant ads. Learn more about cookies and act

Not yet registered? Create a OverBlog!

Create my blog

What is the UK Capital gains tax rate

The profit that a person makes when s/he ceases to own an asset is considered to be a taxable amount in the United Kingdom. This tax is known as the Capital Gains Tax. However, it is not as simple as merely selling an asset. The gain can also be taxed if the asset is given away as a gift, is transferred to someone else, is exchanged for something else or even if compensation for the asset is received.

The basics

How it works
If an individual buys shares for £1000 in June 2000 and sells them for £10000 in
June 2010, he has made a profit of £9000. This amount is then, subject to the Capital Gains Tax rate. An individual
If you are acting as an individual and you have made a profit from a Capital Gains transaction, you will be charged at a rate of between 18-28 percent of taxation.
18 percent is the flat rate, but this rose to 28 percent for higher earners as of
June 2010. A company
The calculation for companies is slightly more complex than for individuals. Companies use what is known as "indexation relief" to the base cost. It is increased according to the retail prices index. This means that the profit is calculated on an inflationary basis. Once the profit has been calculated, the company is taxed at the appropriate marginal rate of company tax.

Other information

Exemptions
Some assets are exempt from Capital Gains Tax. These include your car: personal possessions that are worth up to £6000 each, such as jewellery, paintings or antiques; stocks and shares that are held in tax-free investment savings accounts, such as ISAs and PEPs; UK state or 'gilt-edged' securities such as National Savings Certificates, premium bonds and loan stock issued by the Treasury; betting, lottery or pools winnings; personal injury compensation and foreign currency held for personal use outside the UK. Corporation Tax Act 2010
Capital Gains Tax is outlined in the Corporation Tax Act 2010. It is an act of parliament that received royal assent in March 2010. Reporting a loss
When an asset loses most or all its value, the owner may be able to claim this as a loss, even if he still owns it as an asset. The only prerequisite is that the asset must have lost its value during the time that s/he owned it. If this is the case, a negligible value claim can be made.

Same category articles Taxation

What are AIM funds?

What are AIM funds?

AIM, or Alternative Investment Market, represents a sub-market of the London stock market and global investment market. The Invesco AIM investment market is designed for small fund families and small businesses to make investments with better flexibility. For those who want to know in detail what are AIM funds, read this article for more information.
How to calculate income tax in the UK

How to calculate income tax in the UK

The UK income tax liability is calculated on the income received in the tax year to 5 April after deduction of relevant expenses and allowances. Income from employment, self-employment, property and savings must be taken into account.
How to use a UK income tax calculator

How to use a UK income tax calculator

This article will be discussing how to use an income tax calculator in the United Kingdom. İt is important to understand what tax code you are on and how your salary is calculated. This article will provide a guide to using a UK income tax calculator.
How to claim tax back?

How to claim tax back?

Every year, many people find that they have paid too much tax. This cannot always be fixed during the period of work, so it leads to getting a tax rebate at the end of the year. You have four years to make a claim if you think you are entitled to a repayment on your tax and HMRC has not spotted it first.