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Capital Taxes

  1. Capital Gains Tax

    A capital gain arises when certain capital (or 'chargeable') assets are sold at a profit. The gain is the sale proceeds (net of selling costs) less the purchase price (including acquisition costs). The taxation of capital gains has been significantly revised from 6 April 2008. This factsheet deals with the current position.

  2. Capital Gains Tax and the Family Home

    The capital gains tax (CGT) exemption for gains made on the sale of your home is one of the most valuable reliefs from which many people benefit during their lifetime. The relief is well known: CGT exemption whatever the level of the capital gain on the sale of any property that has been your main residence. In this factsheet, we look at the operation of the relief and consider factors that may cause it to be restricted.

  3. Inheritance Tax

    Inheritance tax (IHT) is levied on a person’s estate when they die, and certain gifts made during an individual’s lifetime. Most gifts made more than seven years before death will escape tax. Therefore, if you plan, gifts can be made tax-free: the result can be a substantial tax saving. We give guidance below on some of the main opportunities for minimising the impact of the tax. It is however important for you to seek specific professional advice appropriate to your personal circumstances.

  4. Pre-Owned Assets

    With IHT came the concept of ‘potentially exempt transfers’ (PETs): make a lifetime gift of capital to an individual and, so long as you live for seven years from making the gift, there can be no possible IHT charge on it whatever the value of the gift. The rules create uncertainty until the seven-year period has elapsed but, at the same time, opportunity to pass significant capital value down the generations without an IHT charge. Of course this is to over simplify the position and potentially ignore a whole host of other factors, both tax and non-tax, that may be relevant.

  5. Stamp Duty Land Tax

    SDLT is payable by the purchaser in a land transaction. A transaction will trigger liability if it involves the acquisition of an interest in land in the United Kingdom. This will include a simple conveyance of land such as buying a house, creating a lease or assigning a lease.

  6. Trusts

    Trusts are a long established mechanism that allows individuals to benefit from the assets without assuming the legal ownership of those assets so that others (the trustees) have day-to-day control over the assets. A trust can be extremely flexible and have an existence totally independent of the person who established it and those who benefit from it.