For most capital gains realised in the 2026–27 tax year, Capital Gains Tax (CGT) is reported and paid by 31 January 2028 via the self-assessment system. This applies to gains on assets such as shares, investments and commercial property.

However, UK residential property is an important exception. Where a residential property is sold and the gain is not fully covered by Private Residence Relief, the capital gain must be reported and paid within 60 days of completion. This rule applies to disposals completed on or after 27 October 2021.

The 60-day deadline mainly applies to rental properties, second homes or properties only partly used as a main residence. If the property is jointly owned, each owner must report and pay tax on their share of the gain separately.

To calculate the gain, you will need details such as purchase and sale dates, acquisition cost, legal and professional fees, and qualifying improvement expenditure. Selling costs, including estate agent and legal fees, can also be deducted. Gathering this information in a timely manner is important given the tight 60-day deadline.

If you have disposed of, or are planning to dispose of, an asset that may give rise to a gain, we would be happy to help you calculate taxable gains, ensure that the filing and payment deadlines are met and avoid unnecessary interest or penalties.

When a sole trader or partnership transfers a business to a company, a chargeable gain may arise. This is calculated by reference to the market value of the business assets at the date of incorporation (including goodwill), compared with their original base cost. The resulting gain would ordinarily be subject to Capital Gains Tax.

In many cases, however, the transfer is structured to qualify for Incorporation Relief. Broadly, this requires that the whole business is transferred as a going concern, together with all of its assets (other than cash), in exchange wholly or partly for shares issued by the company.

Where the conditions are satisfied, Incorporation Relief applies automatically and no formal claim is required. The effect of the relief is to defer the gain by reducing the base cost of the shares received, thereby postponing the tax charge until those shares are subsequently disposed of.

A taxpayer may elect for the relief not to apply. This election must be made in writing by 31 January, two years after the end of the tax year in which the incorporation takes place. For example, for a transfer in the current 2026–27 tax year, the election deadline is 31 January 2030. This deadline is reduced by one year if the shares are disposed of in the tax year following that of incorporation.

Private Residence Relief (PRR) is a valuable Capital Gains Tax relief that can eliminate the tax due when you sell your home. In simple terms, it applies to periods when a property has been your only or main residence. However, if you spend time living away from home, the position becomes less clear, and CGT may well be due.

The starting point is that you will usually get full relief for the time you actually lived in the property, plus some additional “deemed occupation” periods. Most notably, the final 9 months of ownership always qualify for relief, provided the property was your main home at some stage.

You may also qualify for relief during absences when you live away from your home. Broadly, this includes up to three years away for any reason, up to four years if working elsewhere in the UK, and unlimited periods if working abroad. In most cases, you must have lived in the property before and after the absence, unless work prevents your return.

There are also special rules for the first two years of ownership if the property was being built or renovated or you could not sell your old home.

Where you own more than one property, only one can qualify as your main residence at any given time. Married couples and those in a civil partnership are restricted to a single main home between them.

It is important to carefully keep track of time living away from your home in order to correctly be able to calculate if any how much CGT is due when your home is sold.

The tax rate for Business Asset Disposal Relief (BADR) will increase to 18% (from 14%) on 6 April 2026. BADR offers a reduced Capital Gains Tax (CGT) rate on qualifying disposals such as the sale of a business, shares in a trading company or an individual’s stake in a trading partnership.

These rate increases are accompanied by new anti-forestalling rules designed to prevent individuals from securing the lower BADR rate by using early contracts. Where an unconditional contract is entered into during the 2025-26 tax year but completes on or after 6 April 2026, the disposal will normally be treated as occurring at completion, meaning the higher 18% rate applies. 

However, the legislation allows for “excluded contracts” where the contract was not entered into to secure a tax advantage and, where parties are connected, was entered into wholly for commercial reasons. Where total gains under excluded contracts do not exceed £100,000, the anti-forestalling does not apply.

The lifetime BADR limit remains £1 million meaning individuals can use the relief multiple times, provided their total gains from qualifying disposals do not exceed this threshold. However, the higher CGT rates obviously reduce the tax advantage available. Investors’ Relief CGT rates are currently in line with those for BADR and will also increase to 18% in April 2026.