How much can I make tax-free on shares each year?

£3,000 of capital gain in 2026/27 under the Annual Exempt Amount. Profits above this are taxed at 18% if you're a basic-rate taxpayer or 24% at higher rate.

Do I pay CGT on my main home?

Usually no — Principal Private Residence relief makes your main home CGT-free for the period you lived in it as your only or main home. The relief can be partial if you let part of it out or had periods of absence. Second homes and buy-to-lets are fully chargeable.

Has the CGT allowance always been £3,000?

No, it has been cut sharply. The allowance was £12,300 in 2020/21 to 2022/23, dropped to £6,000 in 2023/24, then to £3,000 in 2024/25. The OBR estimates this brought about 260,000 additional taxpayers into the CGT net.

What is the Capital Gains Tax allowance?

By the UK Tax Drag editorial team · Reviewed 12 May 2026

The Capital Gains Tax Annual Exempt Amount (AEA) is the tax-free profit you can make on UK asset sales each year. In 2026/27 it is £3,000 — slashed from £12,300 in 2022/23. Above this, gains are taxed at 18% (basic rate) or 24% (higher rate) on most assets, with 18%/24% on residential property too following 2024 reforms.

How the CGT allowance has been cut

Tax year	Annual Exempt Amount
2020/21 to 2022/23	£12,300
2023/24	£6,000
2024/25 onwards	£3,000

The cut from £12,300 to £3,000 over two years is the steepest UK tax-free allowance reduction of the decade. The Office of Budget Responsibility estimates an additional 260,000 UK taxpayers now owe CGT each year as a result.

Trusts and personal representatives get only £1,500 of AEA (half the personal amount).

CGT rates by asset type (2026/27)

Asset type	Basic rate	Higher rate
Shares, funds, business assets	18%	24%
Residential property (second homes, BTL)	18%	24%
Carried interest	18%	24%
Crypto-assets	18%	24%
Main residence (Principal Private Residence)	Usually exempt

Note: from 30 October 2024, the rates on shares and most other assets were aligned with residential property at 18%/24%. Previously shares were 10%/20%, so this is a substantial increase that the 2024 Autumn Statement introduced.

How to use your £3,000 efficiently

Spouse transfer. Married couples / civil partners can transfer assets to each other CGT-free. Doing so before selling means both £3,000 allowances can be used — £6,000 of gains tax-free in total.
Bed-and-ISA / Bed-and-Spouse. Sell assets in a GIA up to your £3,000 gain, then rebuy them inside an ISA (£20,000/yr cap) or transferred to spouse. The 30-day "bed and breakfast" rule prevents you from rebuying the same asset in your own name immediately.
Spread sales across tax years. A £10,000 gain split as £3,000 in March + £7,000 in April uses two annual allowances, saving CGT on £6,000 total at 24% = £1,440.
Pension contribution to reduce CGT rate. Higher-rate CGT (24%) is reduced to basic-rate (18%) on gains that fall within the basic-rate band of your income. Pension contributions reduce taxable income, potentially shifting some gains into the basic-rate CGT band.

When do you actually pay CGT?

UK CGT is now reported within tight deadlines, especially for property:

Residential property: file a UK Property CGT return within 60 days of completion and pay tax within 60 days.
Other gains: declare via Self Assessment by 31 January following the tax year. Tax payable by the same date.
If you have no other Self Assessment triggers and your gains are below £50,000, you can use HMRC's "real-time" CGT service to report and pay separately.

The 60-day property trapThe 60-day window is short. Many homeowners selling a second home find they owe £20,000+ of CGT they didn't budget for, due in eight weeks. The CGT property calculator works out the bill in advance.

Calculate your CGT precisely

The CGT property calculator handles main residence relief, lettings, refurbishment costs and the 60-day reporting requirement.

Open the CGT property calculator →

Sources and methodology

CGT rates and allowances from gov.uk/capital-gains-tax. Allowance cuts from Autumn Statement 2022 and 2024. Rate alignment from October 2024 Budget.

UK Tax Drag is not authorised by the Financial Conduct Authority and does not provide regulated financial advice — see the content disclaimer for the full position. The methodology page documents how every calculator is built and reviewed.

CGT property calculator — residential property gains with PPR relief
Capital gains shares calculator — gains on shares, funds and ETFs
UK Capital Gains Tax guide 2026/27 — full reference
CGT spouse transfer tip — using both allowances
Full UK money glossary
FAQ library

Worked example: realising a £10,000 gain

The allowance is deducted from your total gains for the year before tax is applied — and it is "use it or lose it", with no carry-forward to next year. Imagine you sell a fund held in a General Investment Account and realise a £10,000 gain:

Step	Figure
Total gain for the year	£10,000
Less Annual Exempt Amount	−£3,000
Taxable gain	£7,000
If a basic-rate taxpayer (18%)	£1,260
If a higher-rate taxpayer (24%)	£1,680

Two refinements catch people out. First, you offset losses before the allowance: if you also crystallised a £2,000 loss elsewhere, your net gain is £8,000, and only £5,000 is taxable after the AEA. Capital losses can be carried forward indefinitely if reported to HMRC, so it pays to claim them even in a year you owe nothing. Second, you deduct allowable costs — purchase price, buying and selling fees, and capital improvements — when working out the gain in the first place.

Which rate you pay: gains stack on top of income

Whether your gain is taxed at 18% or 24% is not decided by the gain alone — it depends on how much of your income-tax basic-rate band is left. You add your taxable gain on top of your taxable income; the part that still fits inside the basic-rate band is taxed at 18%, and anything above is taxed at 24%. A single gain can therefore be split across both rates.

Worked example — a split-rate gainYou have £40,000 of taxable income, leaving roughly £5,000 of basic-rate band unused (the band runs to about £50,270). You realise the £7,000 taxable gain from the example above. The first £5,000 is taxed at 18% (£900) and the remaining £2,000 at 24% (£480) — a total of £1,380, not a flat £1,260 or £1,680. This is also why a pension contribution, which extends your basic-rate band, can pull more of a gain down into the 18% rate.

What is exempt from Capital Gains Tax

A large share of most people's assets never attracts CGT at all. The main exemptions are:

Your main home — covered by Private Residence Relief for the period it was your only or main residence (relief can be partial if you let it out or were absent for long periods).
Anything inside an ISA or pension — gains on shares and funds in a Stocks & Shares ISA or a SIPP are completely free of CGT, with nothing to report.
UK government gilts and most qualifying corporate bonds — exempt from CGT (though the interest is still taxable income).
Personal possessions ("chattels") sold for £6,000 or less — e.g. jewellery, paintings, antiques. Above £6,000 a tapering calculation applies.
Private cars, including classic and collectible cars, plus betting, lottery and premium-bond winnings.
Transfers between spouses or civil partners who live together — made on a "no gain, no loss" basis (see below).
Gifts to UK-registered charities.

Foreign currency for your own personal use and most wasting assets (those with a predictable life under 50 years) are also outside the net. Crypto-assets, by contrast, are not exempt — HMRC treats them like shares.

Using both spouses' allowances and Bed and ISA

Because transfers between spouses and civil partners are CGT-free, a couple can legitimately double up. Move part of a holding into joint names or to the lower-earning partner before selling, and you can use two £3,000 allowances — £6,000 of tax-free gains a year — and have the taxable slice fall on whoever has the lower CGT rate.

Worked example — Bed and ISA across a coupleYou hold a fund standing at a £6,000 gain in a GIA. Sold alone as a higher-rate taxpayer: £6,000 − £3,000 AEA = £3,000 taxable at 24% = £720. Transfer half to your spouse first, and you each realise a £3,000 gain — both fully covered by your separate £3,000 allowances, so the tax bill is £0. Each of you can then repurchase inside an ISA so future growth is sheltered for good.

"Bed and ISA" is the manoeuvre of selling in a taxable account and immediately rebuying the same investment inside an ISA. It sidesteps the 30-day "bed and breakfasting" rule (which blocks repurchasing the same asset in your own name within 30 days to refresh its base cost) because the holding is now inside a different, tax-exempt wrapper. Done each April, it lets you crystallise gains within the annual allowance and steadily shift a portfolio out of the CGT net. The same applies to repurchasing within a pension. Keep the realised gain each year at or under £3,000 and the entire migration can be achieved tax-free.

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