Capital Gains Tax: the £3,000 allowance and the 18% and 24% rates
How the Capital Gains Tax annual exempt amount and rates work for 2026-27, with two worked examples.
The annual exempt amount
GOV.UK says that for the 2026-27 tax year the Capital Gains Tax allowance is £3,000. You only pay tax on the part of your gains above it.
The rates
For gains made from 6 April 2026, GOV.UK says:
- Higher or additional rate taxpayers pay 24% on their gains.
- Basic rate taxpayers pay 18% on gains up to the basic rate band and 24% on any gains above it.
- Sole traders, partnerships and trustees with Business Asset Disposal Relief pay 18%.
To work out which rate applies, GOV.UK says to deduct the annual exempt amount from your taxable gains and add the result to your taxable income. Gains within the basic rate band are taxed at 18%, and any amount above it at 24%.
Two worked examples
Both assume a gain of £10,000 in 2026-27 and the £3,000 allowance, so £7,000 is taxable.
- A basic rate taxpayer with £20,000 of other taxable income. The basic rate band is £37,700, so £17,700 of it is unused. The whole £7,000 falls inside it and is taxed at 18%, which is £1,260.
- A higher rate taxpayer. The £7,000 is taxed at 24%, which is £1,680.
What this page does not cover
Gains on residential property, business gains and how to report and pay have their own GOV.UK guidance. GOV.UK says you usually do not pay tax when you sell your home, and that business gains may be taxed at a different rate. Check the reporting and paying guidance for deadlines.
Check your own figures
The SavingTax app has a Capital Gains Tax calculator on Premium and a guide on Capital Gains Tax.
Sources
This page is general information, not financial, tax or legal advice. The examples are simplified. Your own position depends on your circumstances. For advice, speak to a qualified professional.