Capital Gains Tax increase announced with 'who has to pay it' confirmed

Capital Gains Tax increase announced with 'who has to pay it' confirmed

by · Birmingham Live

A Capital Gains Tax hike has been confirmed by Labour Party Chancellor Rachel Reeves - with who has to pay it explained. The headline rates of capital gains tax will increase, with the lower rate rising from 10% to 18% and the higher rate from 20% to 24%, the Chancellor has announced.

Paul Robbins, Associate Director of Tax at Croner-i, on the major tax changes in today’s Budget, said: “Capital Gains Tax rates are to rise from 10% to 18% for non-higher rate taxpayers, and from 20% to 24% for others, to match the current rates on residential property (which will be frozen).

“The long-rumoured “axe” has fallen on Business Asset Disposal Relief (or BADR), although its withdrawal will not be complete, at least not yet, and will be phased in over coming years. The £1m BADR lifetime allowance will be maintained, but the reduced rate of tax applying where BADR is available will rise to 14% in 2025-26 and 18% 2026-27.“

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Leader of the Opposition Rishi Sunak has warned that Britain’s poorest pensioners have been “squeezed” in Rachel Reeves’ Budget. He told the Commons: “Britain’s poorest pensioners squeezed, welfare spending out of control and a streak of tax rises they promised the working people of this country they would not do.

To shouts of “up” from his own benches, the former prime minister and chancellor said: “National insurance, up. Capital gains tax, up. Inheritance tax, up. Energy taxes, up. Business rates, up. First-time buyer stamp duty, up. Pensions tax, up. They have fiddled the figures.”

Nus Ghani, deputy speaker, called on MPs to “simmer” after shouts from both sides of the House. Capital Gains Tax is a tax charged if you sell, give away, exchange, or dispose of an asset - this could be things such as a second home, shares in companies, art, or jewellery - and make a profit or "gain".

It is not the amount of money you receive for the asset, but the gain you make, that is taxed.