CGT: Clients need 'different wrappers at different times'

A platform offers the opportunity to invest in multiple tax wrappers

clock • 4 min read

Barry Foster looks at the tax rules surrounding CGT and which wrapper provides the most protection...

The capital gains tax (CGT) annual exemption reduced from £6,000 to £3,000 from 6 April 2024. That's a significant drop from the £12,300 exemption in place just two years ago. And for trusts it has fallen to just  £1,500. To put this in some context, an investment of £60,000 growing at 5% capital growth would achieve a £3,000 capital gain if crystallised. So what is the value of the CGT annual exemption? Well of course it isn't £3,000 it is the amount of tax you would save by not paying tax on that £3,000 of gain. If you would be liable to CGT @ 20% the annual exemption is worth £60...

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

Spring Budget decisions motivating client push for more tax efficiency

Spring Budget decisions motivating client push for more tax efficiency

‘Frozen thresholds are impacting on bonds positively’

Hope Coumbe
clock 16 May 2024 • 1 min read
CGT: Clients need 'different wrappers at different times'

CGT: Clients need 'different wrappers at different times'

A platform offers the opportunity to invest in multiple tax wrappers

Barry Foster
clock 14 May 2024 • 4 min read
Business Relief in IHT planning set to become 'even more important'

Business Relief in IHT planning set to become 'even more important'

Advisers expect to see an increase in unquoted BR in IHT planning

Isabel Baxter
clock 09 May 2024 • 1 min read