The main Budget announcement concerned an increase in the rate
of capital gains tax (CGT).
Capital Gains Tax
From midnight tonight there is an increase in the rate of CGT
for individuals whose taxable income and taxable capital gains when
added together are more than £37,400. Their rate of CGT
on any gains exceeding the threshold rises from 18% to 28%.
However, capital gains tax for any gains below the threshold
remains at 18%.
The annual exemption of £10,100 has survived, meaning that
the first £10,100 of gains in each year are tax-free (and
unlike for the purposes of income tax, this exemption is available
whatever the level of gains).
One practical aspect of this change is that deferral of
gains into successive tax years through loan notes and spouse
transfers may become more popular again.
