Fiscal drag means 'record number' of people now pay CGT

More people paid CGT in 2021/22 than ever before

Jenna Brown
clock • 2 min read

Some 370,000 people declared capital gains tax (CGT) on their returns in 2021/22, a record number brought about by so-called fiscal drag, according to industry experts.

Latest government figures showed the number of people paying CGT was up 21% from the previous tax year, law firm Moore Kingston Smith said. Tax head Tim Stovold said it was "thanks to fiscal drag". Fiscal drag occurs when tax thresholds and allowances do not keep up with inflation or wage growth, resulting in more of a taxpayers' income being taxable, according to the government. Most tax thresholds have been frozen since the 2021 Spring Budget. Stovold explained fiscal drag had resulted in "bumper" CGT collection in 2021/22 "with tax due of £16.7bn, up 15.2% from the prior year. Howe...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Tax planning

Effectiveness of Labour's immediate CGT hike under question

Effectiveness of Labour's immediate CGT hike under question

CGT rates were raised in last Wednesday’s Budget

Jen Frost
clock 06 November 2024 • 2 min read
Labour's tax clampdown sparks fraud investigations 'spike' warning

Labour's tax clampdown sparks fraud investigations 'spike' warning

High-income individuals could look to ‘illegal tactics’, crime specialist says

Jen Frost
clock 31 October 2024 • 2 min read
Autumn Budget 24: Business owners hit with surprise tax triple whammy

Autumn Budget 24: Business owners hit with surprise tax triple whammy

Business owners face CGT, IHT, NICs changes

clock 30 October 2024 • 4 min read