Capital Gains Tax: the basics
Capital Gains Tax (CGT) is charged on the gain you make when you dispose of an asset — not on the whole amount you receive. A disposal includes selling something, but also giving it away, which counts as a disposal at market value.
- Common triggers: selling shares, a second or buy-to-let property, a business, or valuable possessions
- Each person has an annual tax-free allowance before any gain is taxable
- Your main home is usually covered by Private Residence Relief; assets in ISAs and most private cars are exempt
- Reliefs worth checking include Business Asset Disposal Relief, gift holdover and rollover relief
- Reporting and payment deadlines differ by asset — UK residential property has its own tighter window
How MMC helps: we calculate the gain, identify and claim every relief you're entitled to, advise on timing a disposal across tax years, and report it correctly and on time.
Inheritance Tax and estate planning
Inheritance Tax (IHT) can apply to your estate when you die, and to some gifts made in your lifetime. Sensible planning, started early, can make a substantial difference to what passes to your family rather than to HMRC.
- A tax-free nil-rate band applies, with an additional residence band where a home passes to direct descendants
- Transfers between spouses and civil partners, and gifts to charity, are generally exempt
- Annual gift exemptions and gifts out of surplus income can reduce your estate over time
- Business Relief and Agricultural Relief can shelter qualifying assets
Making lifetime gifts
Giving assets away during your lifetime is one of the simplest ways to reduce a future Inheritance Tax bill — but the rules reward planning and good records.
- Many gifts are "potentially exempt": they fall outside your estate if you survive seven years
- Several gifts are immediately exempt, including small gifts and the annual exemption
- Watch the "gift with reservation" trap — keeping the benefit of something you've given away
- A gift can be a disposal for Capital Gains Tax as well as an Inheritance Tax transfer
These factsheets are general guidance, not advice, and rates and thresholds change. For current figures see our tax rates & allowances page, and please contact us for advice tailored to your circumstances.
