If you sell assets such as shares or land, you may need to report your Capital Gains Tax either through Self-Assessment or HMRC’s ‘real time’ CGT service; deadlines and rates depend on the type of asset sold.

If you have Capital Gains that are not related to the sale of UK residential property after 6 April 2020, there are two main ways to report them. The first is by filing a self-assessment tax return or using the ‘real time’ Capital Gains Tax (CGT) service. Before reporting, you must determine if you need to pay tax and how much you owe.

For reporting in a self-assessment tax return, you will include your Capital Gains for the tax year after you sell or dispose of an asset. You can seek help from an accountant or tax advisor, and after submission, HMRC will provide details on how and when to pay.

Alternatively, the ‘real time’ CGT service allows you to report gains from assets sold during the 2024-2025 or 2025-2026 tax years. This service is only available to UK residents and cannot be used for certain items like UK residential property gains or foreign tax credits.

After reporting, HMRC will issue a payment reference number (starting with ‘X’), which you can use for payments via online banking, cheque, or the online tax payment service. You must report your gain by 31 December in the tax year following the gain and pay by 31 January. For example, if you made a gain in the 2024-25 tax year, you need to report it by 31 December 2025 and pay by 31 January 2026.

The main CGT rates for assets other than residential property and carried interest is currently 18% for Income Tax basic rate payers and 24% for Income Tax higher rate payers.

If you sell UK residential property not covered by the Private Residence Relief, for example, a second home, then you must report the sale with a calculation of any CGT due, within six months of completing the sale. HMRC have set up a separate filing process to report these gains.

If you have tenants in your home, it’s essential to understand the Capital Gains Tax (CGT) implications. Typically, there is no CGT on the sale of a property used as your main residence due to Private Residence Relief (PRR). However, if part of your home has been let out, your entitlement to PRR may be affected.

Homeowners who let out part of their property may not qualify for the full PRR, but they could be eligible for letting relief. Letting relief is available to homeowners who live in their property while renting out a portion of it.

The maximum letting relief you can claim is the lesser of the following:

• £40,000
• The amount of PRR due
• The chargeable gain made on the part of the property let out

Example:

• You rent out a large bedroom to a tenant, making up 10% of your home.
• You sell the property and make a gain of £75,000.
• You qualify for PRR on 90% of the property (£67,500).
• The remaining gain of £7,500 relates to the portion of the home that’s been let.

In this case, the maximum letting relief due is £7,500, which is the lower of:

• £40,000
• £67,500 (the PRR due)
• £7,500 (the gain on the part of the property that’s been let)

As a result, you would not owe any CGT—the £75,000 gain is fully covered by £67,500 in PRR and £7,500 in letting relief.

Note that if you have a lodger who shares living space with you or if your children or parents live with you and pay rent or contribute to housekeeping, you are not considered to be letting out part of your home for tax purposes.

Business Asset Disposal Relief (BADR) offers a significant tax benefit by reducing the rate of Capital Gains Tax (CGT) on the sale of a business, shares in a trading company or an individual’s interest in a trading partnership.

On 6 April 2025, the BADR CGT rate increased from 10% to 14% for disposals made in the 2025–26 tax year. However, the rate is set to rise again from 6 April 2026, to 18%. This means that qualifying disposals made after April 2026 will be subject to a higher CGT rate once again.

The lifetime limit for claiming BADR remains at £1 million, allowing individuals to claim the relief multiple times as long as the total gains from all qualifying disposals do not exceed this threshold.

In addition to changes to BADR, there were also changes to Investors’ Relief. Since 30 October 2024, the lifetime limit for Investors' Relief has been reduced from £10 million to £1 million. The CGT rates for Investors' Relief also align with those for BADR, currently set at 14% and also rising to 18% from April 2026.

These increases in CGT rates are significant and will impact tax planning strategies for business owners and investors. It is also important to note that further changes may be announced in the forthcoming Budget that could further chip away to the benefits of this relief.

Business Asset Disposal Relief (BADR) still offers a valuable tax break, but the CGT rate has risen to 14% from April 2025 and will increase again to 18% in April 2026.

BADR provides a valuable tax advantage by offering a reduced rate of Capital Gains Tax (CGT) on the sale of a business, shares in a trading company, or an individual’s interest in a trading partnership.

The limits for BADR increased for disposals made on or after 6 April 2025. This has seen the CGT rate now applied at a rate of 14% (up from 10%). This change is now in effect and applies to any qualifying disposals taking place within the 2025–26 tax year.

The rate is set to increase again from 6 April 2026, to 18%. This means that disposals qualifying for BADR on or after this date will face a significantly higher CGT rate when compared to the previously long-standing 10% rate.

The lifetime limit for claiming BADR remains at £1 million, allowing individuals to benefit from the relief more than once, provided the cumulative gains from all qualifying disposals do not exceed this threshold.

Additionally, changes have been made to Investors’ Relief. The lifetime limit for this relief was reduced from £10 million to £1 million for qualifying disposals made on or after 30 October 2024. In addition, the CGT rates for Investors’ Relief are now aligned with those for BADR, currently set at 14% and increasing to 18% from April 2026.

Gift Hold-Over Relief is a form of Capital Gains Tax (CGT) relief that allows you to defer paying CGT when certain assets, such as qualifying shares, are given away or sold for less than their market value, typically to benefit the recipient.

Instead of paying tax at the time of the gift, the gain is "held over" and passed on to the person receiving the asset. This reduces their base cost for CGT purposes, meaning the tax is only due when they eventually sell or dispose of the asset.

The individual making the gift will not usually have to pay CGT, as long as the transfer qualifies. However, CGT may still apply if the asset is sold at an undervalue rather than gifted outright. Transfers between spouses or civil partners are generally exempt from CGT.

A joint claim for the relief must be submitted by the giver and the recipient of the business asset gift.

To claim Gift Hold-Over Relief on business assets, you must meet all of the following:

• Be a sole trader, a business partner, or hold at least five percent of the voting rights in a company (your personal company).
• The assets must have been actively used in your business or in your personal company.

If the asset was only partly used for business purposes, partial relief may still be available.

To qualify for the relief when giving away shares, the shares must be in a company that is either:

• Not listed on any recognised stock exchange, or
• Your personal company.

In addition, the company must be primarily involved in trading activities, such as supplying goods or services. Companies that are mainly engaged in non-trading activities, such as investment, will generally not qualify.