Capital Gains Tax - Allowances

Each year you will have an annual tax free allowance for capital gains. The annual allowances could change each tax year.

For the 2010/2011 tax year the limits are:

• £10,100 for individuals
• £5,050 for most trustees

The capital gains tax allowances for trustees is half of the personal exemption.

Any gains made over and above this level would be subject to capital gains tax (cgt).

Any gains below the annual allowance would not be taxed.

Example.

For the current tax year you made a gain of £20,100.

Deduct the annual exemption of £10,100.

Capital Gains tax to be paid on £10,000 (£20,100-£10,100.)