Capital gains tax tips

Capital gains tax

Capital gains tax tips

By Ian Robinson

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Capital gains tax tips

Here are some tips to help keep your capital gains tax bill as low as possible.

There are a number of simple measures you can take to minimise your capital gains tax liability:

  • Keep receipts and records for all assets on which CGT might eventually be due.
  • Husbands and wives, and each civil partner each have their own CGT allowance of £11,100 in 2016-17 (£11,100 in 2015-16). By transferring an asset into your joint names, you can both make use of your tax-free allowance so that up to £22,200 of any gain can be tax-free in 2016-17 (£22,200 in 2015-16). But the transfer to your spouse or partner must be a genuine outright gift.
  • Paintings, antiques and other collectibles can be a tax-efficient investment, especially where they are not treated as a set and so can be sold piece by piece, with each item qualifying for the £6,000 exemption. 
  • Unmarried partners can each nominate a different home as their main home to get tax relief on both. Married couples and civil partners must choose just one, however.
  • If you live in a property as your main home for a time before letting it out, you can potentially reduce the CGT bill when you eventually sell it. See Capital gains and property.
  • If you immediately sell employee shares that you get through a save as you earn (SAYE) share option scheme, company share option scheme or enterprise management incentive scheme, you may have a CGT bill. Consider selling in several tranches so that each year’s gain is within your annual tax-free allowance  of £11,100 in 2016-17. See How capital gains are taxed.
  • If you get shares through a SAYE share option scheme or a share incentive plan, you have 90 days to transfer them tax-free to an Isa or pension. Gains when you eventually sell will then be tax-free.

 

  • Last updated: April 2016
  • Updated by: Ian Robinson