Taxing realised gains.
Ordinarily, each person is entitled to make a gain tax free up to £10,900 (or up to £5,450 for trusts). Thereafter gains are taxed at a rate that is income dependent. Where taxable income is less than £32,010 the capital gains tax rate for gains up to the spare basic rate band allowance is 18 per cent. Thereafter this rises to 28 per cent. The rate applicable to a trust is 28 per cent. For business owners entrepreneurs' relief gives rise to a lower rate of 10 per cent for qualifying gains, which provides for a maximum reduction in tax of £1,800,000 (if the gain were £10 million, the current upper limit).
What tax can be saved by maximising the advantage of family member tax-free exemptions? Should an asset that is going to be sold in the future be transferred into joint names? If a gain is going to be realised, are there other assets which are standing at a capital loss that can be used to reduce the quantum of your gains? If tax is due, are there ways of deferring or rolling over the gain?
If you have any questions or queries relating to Capital Gains Tax, please get in touch.