Neil MacGillivray: The breakdown of CGT on divorce and separation

clock • 4 min read

The Office of Tax Simplification (OTS) issued a second report on the 20 May 2021 in which it took the view that the current treatment of capital gains on separation and divorce is totally unsatisfactory and needs to change. Neil MacGillivray contemplates if capital gains tax on separation and divorce is set to become a thing of the past...

There were more than 91,000 divorces in 2018, and for tax year 2018/19 at least £8 million was paid in capital gains tax (CGT) by just under 300 taxpayers who stated divorce or separation as the reason for the gain in their tax returns. The true figures will be much higher than reported as there's no requirement for taxpayers to give the reason for transferring or disposing of assets. What seems apparent is the unforeseen cost, in perhaps an already expensive situation, of an average CGT bill of around £27,000. Married couples and civil partners have the advantage of being able to tra...

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

Keir Starmer's refusal to rule out wealth tax labelled 'telling'

Keir Starmer's refusal to rule out wealth tax labelled 'telling'

Continued speculation around how the Labour govt might raise revenue

Isabel Baxter
clock 11 July 2025 • 2 min read
Business owners' estates: When cash can be a problem

Business owners' estates: When cash can be a problem

A complex, often overlooked threat

Andrew Aldridge
clock 11 July 2025 • 4 min read
IHT/pensions shake-up threatens SME commercial property owners

IHT/pensions shake-up threatens SME commercial property owners

Evelyn Partners warns thousands of businesses are at greater risk

Jenna Brown
clock 07 July 2025 • 4 min read