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Is Capital Gains Tax Reducing?

The annual exempt amount for the tax year 2023/24 will be £6,000 for individuals and personal representatives and £3,000 for most trustees.


From the tax year 2024/25 the permanent fixed annual exempt amount will be £3,000 for individuals and personal representatives, and £1,500 for most trustees.


So what is reducing, and has reduced is the annual exempt amount to pay Capital Gains Tax, meaning you will pay it sooner than you would have had to previously. 

As confirmed in the 2021 Budget, the annual allowance for CGT was to be frozen at £12,300 from April 2021 until April 2026. However, the Chancellor announced that these amounts will be cut in subsequent tax years instead. This sees the annual exempt amount decreased by £9,300 per year in the 24/25 tax year, compared to what it was meant to be frozen at back in the 2021 Budget.


The Capital Gains Tax proceeds reporting limit will also be fixed at £50,000.

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