Capital gains tax advice for families: plan the sale before you sign

Individuals pay 18% on gains that fall within the unused part of their basic rate band and 24% on the rest, after deducting the £3,000 annual exempt amount. The rates are the same for residential property, shares and most other assets. Your other income decides how much of the gain sits in the lower band, so the same sale can cost two people very different amounts. A quick calculation before you sell shows the real figure.

The annual exempt amount is the part of your gains that is tax-free in a tax year. For 2026/27 it is £3,000 for an individual and £1,500 for most trustees. It is use-it-or-lose-it, so it cannot be carried forward. Couples each have their own, which is one reason that ownership between spouses and civil partners matters when you plan a disposal across two tax years.

Possibly, yes. A gift to anyone other than a spouse, civil partner or charity is treated as a sale at market value, so you can have a taxable gain even though you receive no money. Business assets can sometimes be gifted with the gain held over, but a let property or an investment portfolio usually cannot. Work out the tax first, because the cash to pay it has to come from somewhere.

If you are UK resident and sell UK residential property that produces a gain with tax to pay, you must report it and pay the tax within 60 days of completion. This is done through a separate Capital Gains Tax on UK property account, not just the tax return. Missing the deadline brings interest and penalties, so we diarise it the moment contracts exchange.

Usually, but not always. Private residence relief covers the years you lived in a property as your only or main home, and always includes the final nine months of ownership. It can be reduced if part of the home was let or used for business, or if it was not your main home for some periods. Several homes need an election to choose the main one, and the time limit for it is short.

Yes, by moving assets between you before a sale. Transfers between spouses or civil partners living together are made at no gain and no loss, so the receiving partner takes on the original cost. If one partner has lower income, shifting some ownership first can use their annual exempt amount and bring more of the gain into the 18% band. The gift must be genuine and unconditional.

Yes, if you claim them correctly. Losses in the same tax year are set against that year's gains first, even if that wastes your annual exempt amount. Unused losses carry forward and are then used only to reduce gains down to the annual exempt amount. You must report a loss to HMRC within four years of the end of the tax year, or it can be lost. Losses on sales to connected people are restricted.

The person who has died is not treated as selling their assets, and the executors acquire everything at its market value at the date of death. Any growth up to death is effectively wiped out for capital gains tax, although inheritance tax may apply. That is why holding an appreciated asset until death is sometimes better than gifting it in life, and why the two taxes are planned together.

Shares of the same type in the same company are generally pooled, and the cost of each sale is a proportion of the pool. There are two special rules: shares sold and bought back on the same day are matched together, and shares bought within 30 days after a sale are matched to that sale. Those rules stop a sell-and-rebuy from creating an artificial loss, so check them before any portfolio tidy-up.

It remains valuable for qualifying owners of trading businesses. The rate is 18% from 6 April 2026, up from 14% in 2025/26, on up to £1 million of lifetime gains, compared with 24% at the main higher rate. Conditions apply, including a two-year qualifying period and, for shares, at least a 5% holding. It must be claimed, within a set time limit, so it is not automatic.

Both help in different ways. Pension contributions can extend your basic rate band if you pay tax on gains, so more of a gain is taxed at 18% rather than 24%. An ISA shelters future growth, and you can move investments into one gradually using the annual allowance. Neither removes a gain you have already made on an existing sale, so timing matters.

It depends on your residence and the asset. A non-UK resident pays UK capital gains tax on UK land and property, and on shares in companies that mainly hold UK property, and must report these disposals within 60 days even when no tax is due. If you leave the UK for five years or less, gains on assets you owned before leaving can be taxed when you return.

The gain is measured from the market value at the date of death, not from what the person who died paid. If the property has fallen in value since death, you may have a loss instead. You need a probate valuation or a reliable professional one. Report the sale within 60 days if it is UK residential property and tax is due, and keep the valuation evidence.

In limited cases. Reinvesting in qualifying shares under the Enterprise Investment Scheme can defer a gain, and some business asset disposals attract rollover relief when the proceeds are reinvested in qualifying assets. There is no general right to defer tax by buying another property or investment. The rules are conditional and the clock starts early, so ask before you sell, not after.

Gains on most assets go on your Self Assessment tax return for the year of sale, with the tax due by 31 January after the end of that tax year. UK residential property has the additional 60-day report and payment. Keep dates, costs, valuation evidence and improvement receipts, because HMRC can ask for them years later and the computation is only as good as the records.

A sale to a relative or other connected person is still taxed at the market value, not the price actually paid. So a discounted transfer to a child can leave you with a gain on the full value. It can also affect stamp duty land tax and inheritance tax. We look at all three taxes together before any property moves between family members.

Before exchange, almost always. The date of disposal for capital gains tax is normally when contracts are exchanged, and by then the main planning choices, such as who owns the asset, whether to use a spouse's allowances, and which tax year to sell in, are largely fixed. Advice after completion is mainly about reporting and paying the right amount, not reducing it.