Making the Most of Your Gains
Capital Gains Tax (CGT) is paid on the gain made when you sell most investments including second properties. We will look at CGT relief from EIS and GiftAid in a later section.
If you have made losses in the past, it is important to declare these, as you can carry them forward indefinitely and use them to offset future gains.
You can also use your Annual Exempt Amount (AEA), which is the tax-free amount of gain but has been cut back substantially in recent years. At Altor we help our clients to sell enough assets to raise a gain within their AEA each year, otherwise it is lost, and the gain continues to grow. The most important thing to remember is that you can’t rebuy the same asset you sold within 30 days, or the sale is ignored for tax purposes. This means that some planning is needed as to what the replacement investment is going to be.
If you are gifting an asset with a gain to a discretionary trust (as covered in the trust section), you can make a claim to holdover a gain and pass the problem to the trustees or beneficiaries. This can be useful if there are multiple beneficiaries with multiple AEAs.
Capital Gains tax planning is available to Altor clients in our Bespoke, Main and Family Services.
Nothing on this website or its links constitutes a personal recommendation; the information contained is designed to be informative but not to be relied upon as individual circumstances could affect the relevance of this guidance.