Capital Gains Tax

When someone sells an asset for a profit, capital gains tax is due. Shares, real estate, and other capital assets are examples. If an individual sells a capital asset for a profit that exceeds the annual exclusion threshold for the tax year, capital gains tax may be due.

Capital gains tax may apply to the sale of some of the most frequently sold assets, including:

The method used to calculate capital gains tax?

The capital gains tax calculation is extremely simple. We just take the sales profits and subtract all purchase costs to get the capital gain. For computing the gain, the asset's acquisition price and associated costs are typically deductible.

Every year, individual taxpayers are permitted an annual allowance; any gains above this allowance are subject to the individual capital gains tax rates.

Capital gains tax rates

Gains from residential real estate are taxed at a different rate than gains from other assets. If you pay taxes at a higher or additional rate,

You must pay 28% of your residential property gain.
20% of your earnings from other assets that are charged
If all of your revenues fall within the basic rate band and you are a basic rate taxpayer,
18% of your residential property profit
10% of your gains from other assets that are charged

Tax reliefs

There are numerous tax breaks available for selling assets, including:

Relief for the primary private dwelling (PPR)
Providing relief
Business owners' relief
Deferral relief and rollover relief
Reinvestment relief, gift relief, EIS and SEIS, etc.
Set-offs against the current year or losses that were moved forward
The aforementioned reliefs may lead to considerable tax savings. As a result, we strongly suggest that you get in touch with our experts to get prompt and tax-saving guidance.

How we can help you?

Guidance on how to offset all legally permissible costs with gains
Tips on how to postpone paying capital gains tax
Use the annual exemption allowance as much as possible
Ensuring that all applicable tax reliefs have been utilized to minimize or eliminate the taxable gain
Calculating the tax liability for gains
Preparing your tax return, which will include any financial gains you may have.
Tips on when and how to pay your capital gains tax

For more information and to arrange a free consultation, please contact us.