Capital Gains Tax: gains, losses and rates

Realised and unrealised gains

A gain is realised when you dispose of an asset: you sell it, give it away (other than to your spouse or civil partner), swap it or receive compensation for it. A rise in value while you still own it is unrealised and isn't taxed.

The gain is what you received, less what it cost you and allowable costs such as buying and selling fees and improvements. Growth shown in your forecast is unrealised and is never treated as a gain.

Gains inside an ISA or a pension aren't subject to Capital Gains Tax. Selling your only or main home is usually free of it because of Private Residence Relief.

Capital losses

A loss in the same tax year is set against that year's gains in full, even if that takes them below the Annual Exempt Amount.

Losses from earlier years are used only as far as needed to bring the remaining gains down to the Annual Exempt Amount; anything left carries forward. To use a loss you must have reported it to HMRC, normally within four years of the end of the tax year it arose in. Enter only earlier losses you've reported.

Annual Exempt Amount

Each person can make £6,000 of gains tax-free in 2023/24, and £3,000 in 2024/25 and in 2025/26. It can't be passed to a partner or carried forward if unused. FLYNQD applies it where it saves the most tax.

Rates depend on the disposal date

The rate is set by the date of the disposal, not the date the tax is paid. In 2023/24, gains were taxed at 10% or 20%, or 18% or 28% for residential property, for the whole year. In 2024/25, disposals up to 29 October 2024 were taxed at 10% or 20%, or 18% or 24% for residential property. From 30 October 2024 all gains are taxed at 18% or 24%, and that continues for 2025/26.

That's why FLYNQD needs the exact disposal date: without it the estimate stays partial.

How your income affects the rate

Gains are added on top of your taxable income for the same year. The part that fits in your unused basic-rate band is taxed at the lower rate; the rest at the higher rate.

FLYNQD uses the Income Tax calculation already on the Tax page to find that unused band, so if your Income Tax estimate is partial, the Capital Gains Tax estimate is too. Gift Aid and personal pension contributions extend the basic-rate band for gains, which FLYNQD doesn't yet model; if you've entered either, the rate can't be worked out and the page says so.

Capital Gains Tax and Income Tax

They are separate taxes. Gains don't use your Personal Allowance and don't change your Income Tax. Rent from a property is income; the profit when you sell the property is a gain.

The Tax page shows Income Tax and Capital Gains Tax separately. A combined figure is shown only when both are complete.

Tax on a UK residential property sale normally has to be reported and paid within 60 days of completion. Other gains are paid through Self Assessment by 31 January after the tax year. Capital Gains Tax isn't included when working out payments on account.

What FLYNQD doesn't calculate yet

Private Residence Relief, Business Asset Disposal Relief, Investors' Relief, gift hold-over relief, roll-over relief, EIS and SEIS relief, and any other relief. Choosing one marks that disposal as not calculated, and the estimate stays partial rather than ignoring it.

For shares and funds, you confirm the allowable cost under HMRC's matching rules; until you do, the estimate stays partial. Disposals before 2023/24 or after 2025/26, trusts, non-residents and Scottish-specific situations aren't covered.

What FLYNQD doesn't model yet

Capital Gains Tax isn't included in your forecast, net worth or tax payment dates. An uploaded tax calculation shows HMRC's Capital Gains Tax figure for reference only; it isn't checked. Tax-payment events in your forecast and reminders are planned and not available.

Explore in your plan

• See your tax estimate

Related guides

• Checking your tax against HMRC's figures
• Calendar years, tax years and when tax is paid
• Buying, downsizing and rental property