The capital gains tax allowance — formally the annual exempt amount — is £3,000 for individuals in the 2026/27 tax year, the same as in 2025/26 and 2024/25. Most trustees get £1,500. Gains above the allowance are taxed at 18% within your unused basic rate band and 24% above it. The allowance used to be far bigger: £12,300 as recently as 2022/23.
The capital gains allowance by year
The amount is set in section 1K of the Taxation of Chargeable Gains Act 1992, which now simply says that "the annual exempt amount for a tax year is £3,000". HMRC's published rates table shows how quickly it has been cut:
| Tax year | Individuals, personal representatives and trustees for disabled people | Other trustees |
|---|---|---|
| 2026/27 | £3,000 | £1,500 |
| 2025/26 | £3,000 | £1,500 |
| 2024/25 | £3,000 | £1,500 |
| 2023/24 | £6,000 | £3,000 |
| 2022/23 | £12,300 | £6,150 |
The allowance is personal. Each spouse or civil partner has their own £3,000, and a couple who own an asset jointly can set both allowances against their shares of the gain.
How the allowance works in practice
The allowance is deducted from your total net gains for the tax year, after setting off any losses made in the same year. Three points catch people out:
- Same-year losses come first. When you report a loss, HMRC deducts it from the gains you made in the same tax year before the allowance is applied;
- Brought-forward losses are used more kindly. Losses carried forward from earlier years are only used to bring gains down to the allowance. HMRC's guidance says that if they reduce your gain to the tax-free allowance, you carry the remaining losses forward to a future year;
- Losses must be claimed. You can claim a loss up to 4 years after the end of the tax year in which you disposed of the asset. An unclaimed loss cannot be used.
Some disposals never touch the allowance because they are outside capital gains tax altogether. HMRC lists shares held in an ISA or PEP, UK government gilts (including Premium Bonds) and gifts to charity. Transfers to a spouse or civil partner you live with are treated as made at no gain and no loss under section 58 of the 1992 Act; the exceptions are where you separated and did not live together at all in that tax year, or where you gave them goods for their business to sell on. The spouse who receives the asset takes over your original cost, so the gain is deferred rather than removed.
CGT rates above the allowance in 2026/27
Once gains exceed £3,000, the rate depends on how much of your basic rate band is left after your taxable income. The basic rate band for 2026/27 is £37,700 of taxable income, which on top of the £12,570 personal allowance takes you to £50,270.
- Individuals. 18% on gains that fall within the unused basic rate band and 24% on the rest;
- Trustees and personal representatives. 24% on all gains from 6 April 2026;
- Business Asset Disposal Relief and Investors' Relief. 18% on qualifying gains disposed of from 6 April 2026, up from 14% in 2025/26 and 10% on or before 5 April 2025.
An illustration (not an HMRC figure). An employee on a salary of £45,000 has taxable income of £32,430 after the personal allowance, leaving £5,270 of basic rate band unused. In 2026/27 they sell shares outside an ISA at a gain of £20,000. The allowance reduces that to £17,000. The first £5,270 is taxed at 18% (£948.60) and the remaining £11,730 at 24% (£2,815.20), giving a bill of £3,763.80. A gain of £3,000 or less would have been tax-free.
For the reliefs that reduce the gain before the allowance is applied, see our guide to capital gains tax reliefs; for how the rates moved to this point, see capital gains tax changes.
Trusts and personal representatives
Trustees normally get half the individual allowance, so £1,500 for 2026/27. Where one settlor has made several trusts, Schedule 1C to the 1992 Act divides that half between the trusts in the group, subject to a floor of one-tenth of the individual amount for each trust: £300 at the current level. Trustees of a trust for a disabled person use the full individual amount instead.
Personal representatives administering an estate get the individual allowance for the tax year of death and the two following tax years, which matters when a house or a share portfolio is sold during a long administration.
When you must report, even below the allowance
Being under £3,000 does not always mean there is nothing to report. If you are in Self Assessment, HMRC requires you to report your disposals if the total you sold assets for was more than £50,000 (the rule from 2023/24 onwards), even where the gains are covered by the allowance. The Capital Gains Tax summary notes (SA108) also require the pages to be completed where gains before losses exceed the £3,000 annual exempt amount, or where you want to claim a loss.
Timing depends on the asset:
- UK residential property. Where there is tax to pay, report and pay within 60 days of completion for completions on or after 27 October 2021. A UK resident whose total gains are below the allowance does not need to make this report. Our guide to reporting CGT on UK property covers the return;
- Other assets. Through your Self Assessment return for the year of the sale, or through HMRC's real-time Capital Gains Tax service by 31 December in the tax year after the sale;
- Non-UK residents. Must report all sales of UK property or land, even if there is no tax to pay.
The authoritative figures are on HMRC's Capital Gains Tax rates and allowances page and in section 1K of the 1992 Act.
Using the allowance well
With only £3,000 available, timing makes most of the difference. Spreading disposals across two tax years gives two allowances; moving assets to a spouse or civil partner who lives with you before a sale can use their allowance and any unused basic rate band at 18%; and holding investments inside an ISA takes future gains out of the regime altogether. Claiming old losses that were never reported, within the four-year window, is the other quick win.
If you are planning a sale of shares, property or a business and want the gain, reliefs and reporting worked out before you commit, our capital gains tax team can model the options, and our private client tax service covers the wider family position.