Capital Gains Tax

Capital Gains Tax (CGT) is only charged on gains. You might make a gain when you sell (or give away) an asset for more than it cost. It is the gain that is taxed, not the amount you receive. Therefore, you may have to account for CGT if an asset has increased in value during the time you have owned it. The assets that most often give rise to CGT include land, shares, and antiques.

Certain types of asset are exempt from CGT, for example:

• personal effects or goods (known as ‘chattels’) which are individually worth less than £6,000 when you dispose of them
• private cars

And you only have to pay CGT if:

• your total chargeable gains for the year are more than £8,800 in 2006-07.