Tag Archives: 2019

Capital Gains Tax, UK Budget

Capital Gains Tax (CGT) Allowance 2019/20

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The Capital Gains Tax (CGT) annual exempt amount is the amount of gains that you are allowed to make before paying tax on those profits.

Capital Gains Tax is paid when you sell or dispose of assets such as personal possessions worth more than £6,000, property that is not your main home, shares or business assets.

CGT is based on the amount of profit that you have made, not on the selling price.

Each year the CGT annual exempt allowance is increased in line with the rise in the Consumer Prices Index, rounded up to the next £100.

In 2018/19 the CGT allowance was £11,700.

In 2019/20 this will be increasing to £12,000.

The law also provides that the annual exempt amount available to most trustees of settlements is one half that due to individuals and so this will be £6,000 for the tax year 2019/20.

For details of all current tax rates that we monitor, please see this page.

Tax Codes

Tax Codes 2018/19

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It is generally the case that UK taxpayers will be issued with a new tax code each year. Tax codes are issued to individuals and their employers so that the employer knows how much tax they should deduct from the employee’s earnings each week or month.

Standard tax code for 2018/19

The most common  tax code for those with simple financial situations in 2018/19 (for example, having only one job, no tax owing from previous years, no other employee benefits etc) is 1185L.

This standard tax code means that you are entitled to the UK personal allowance of £11,850 for the year and therefore that is the amount that you can earn before any tax is deducted.

But it may be the case that you have a different number for your tax code or perhaps your code has another letter at the end (instead of L).

If this is the case then one or more of the following situations may apply to you which may affect your tax code (and these are just some examples):

  • you have earnings from another job
  • you receive benefits in kind (e.g. company car)
  • you owe tax from previous years
  • you also have pension income
  • you have or you receive a transfer of the marriage allowance
  • you have earnings over £100k for the tax year
Confused about your tax code?

If you can’t figure it out why you  have a particular tax code, you will probably need to speak to the Inland Revenue to check that you have the right tax code and will not be paying too little (or indeed too much) tax in 2018/19. The number to call for tax code queries is 0300 200 3300.

Or you may find it easier to check your tax code online which you can here do if you have a Government gateway ID.

Tax code letters

So the letters at the end of the tax code may also give you an indication of what your code is all about.

There are a couple of new tax codes that have been introduced recently which take account of the new transferable marriage allowance – those are the letter M if you have received a transfer of the marriage allowance and the letter N if you have given a up part of your allowance. You can find more information on those letters here.

You can check out a full list of the tax code letters and what they mean on the Inland Revenue website.

Capital Gains Tax, Tax Allowances

Capital Gains Tax 2018/19

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Capital Gains Tax Allowance 2018/19This is a summary of the Capital Gains Tax Allowance for 2018/19.

Capital Gains Tax (CGT) is payable when you sell something and make a profit on it as well as when you give something away that would otherwise be included in CGT.

Some things are not liable for CGT however and you should check the rules with HMRC for your individual circumstances.

The amount of CGT that is due depends on the profit you make (i.e. the amount you sell it for less the amount you paid for it) and is only payable if it exceeds the CGT allowance for the tax year in which you make the gain.

The CGT Allowance for 2018/19 is £11,700.

This amount has been increased from 2017/18 when the rate was £11,300.

Examples of when Capital Gains Tax is due could be:

  • On the sale of a second property
  • On the disposal of personal assets that are worth more than £6,000 (although this does not include your car)
  • On the sale of shares (that are not held in an ISA)

Obviously if your profits from selling these types of goods/assets is below the allowance then no tax is payable.