1. What is HMRC CGT Calculation?

The HMRC Capital Gains Tax (CGT) calculation determines the tax owed on profits from selling assets that have increased in value. The 2023/24 tax year has specific rates and allowances set by HM Revenue & Customs.

2. How Does the Calculator Work?

The calculator uses the CGT equation:

Where:

• \( Gain \) — Profit from the sale of assets (£)
• \( Rate_{23/24} \) — CGT rate for the 2023/24 tax year (decimal)
• \( Allowance \) — Annual exempt amount for 2023/24 (£)

Explanation: The calculation multiplies your gain by the appropriate tax rate, then subtracts your annual tax-free allowance.

3. Importance of CGT Calculation

Details: Accurate CGT calculation ensures you pay the correct amount of tax on asset disposals and helps with financial planning for tax liabilities.

4. Using the Calculator

Tips: Enter your total gain in £, the applicable CGT rate (as a decimal, e.g., 0.2 for 20%), and your annual allowance. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What are the CGT rates for 2023/24?
A: For individuals, rates are typically 10% (basic rate) or 20% (higher rate) for most assets, and 18% or 28% for residential property.

Q2: What is the annual exempt amount for 2023/24?
A: For individuals, the annual exempt amount is £6,000 (reducing to £3,000 in 2024/25).

Q3: When is CGT payable?
A: CGT is normally reported and paid through Self Assessment, with payment due by 31 January following the tax year.

Q4: Are there any reliefs available?
A: Yes, reliefs like Private Residence Relief, Business Asset Disposal Relief, and others may reduce your CGT liability.

Q5: What if my CGT calculation is negative?
A: The calculator shows £0 when the result is negative, as you can't have negative CGT liability.