| A new rate of Capital
Gains Tax (CGT) of 28% will be introduced.
For individuals, the rate of CGT remains
at 18% where total taxable gains and
income, after taking into account all
allowable deductions including losses,
personal allowances and the CGT annual
exemption, are less than the basic rate
limit. The new 28% rate will apply to
gains or any parts of gains above this
limit.
The new rate of CGT will apply to gains
arising on or after 23 June 2010.
Subject to a number of conditions,
gains on qualifying business disposals by
individuals and certain trustees are
eligible for Entrepreneurs’ Relief. This
provides an effective CGT rate of 10% and
works by applying a 4/9 reduction to the
chargeable gain and then charging the
balance at 18%. The change to the CGT
rate would mean that the normal 4/9
reduction would no longer achieve 10%. The
rules will be changed so that the rate of
tax for gains on qualifying disposals on
or after 23 June 2010 will be 10% and the
previous 4/9 reduction will cease to apply
from this date.
The amount of gains that can qualify
for Entrepreneurs’ Relief will also be
raised from £2 million to £5 million for
gains arising on or after 23 June 2010.
Link:
HMRC Budget note |
