- Written by
- Emily Warrener, Associate Solicitor
Attention investors, entrepreneurs, and homeowners! A crucial change in Capital Gains Tax (CGT) is coming in April 2024. The tax-free allowance for individuals is dropping from £6,000 to £3,000, meaning you'll pay more tax on asset sales. But don't panic! There's still time to optimize your tax position and potentially save money.
From 6 April 2024, the amount of capital gains you can keep tax-free is halving. This applies to individuals selling assets like shares, property (excluding your main residence), and even valuable belongings like antiques or artwork.
How will this impact you?
If you plan to sell any assets in the coming year, the reduced allowance could significantly increase your tax bill. This means less money in your pocket after the sale.
What can you do?
- Act before 5 April 2024: Utilize the current higher allowance by selling assets before the deadline. This could be a good strategy if you have any planned disposals or are considering early sales to offset potential future losses.
- Seek expert advice: Navigating tax complexities can be tricky. Consulting a qualified tax advisor can help you understand the impact of the change, explore potential tax-saving strategies, and ensure compliance with regulations.
- Consider alternative disposal methods: Gifting assets to loved ones (within specific limits) can be a tax-efficient way to transfer ownership and potentially utilize their higher allowances. However, be mindful of potential inheritance tax implications.
- Explore tax reliefs and exemptions: Various reliefs and exemptions can help reduce your CGT liability. Examples include Entrepreneurs' Relief for business asset sales and the Principal Private Residence Relief for selling your main home.
Remember: This blog is for informational purposes only and does not constitute personalised tax advice. Every individual's situation is unique, and consulting a qualified tax advisor is crucial to make informed decisions and maximize your tax efficiency.
Don't wait until the deadline! Contact us today on 020 8290 0440 for a personalised consultation and explore strategies to minimise your tax burden in light of the changing CGT landscape.
By taking action now, you can make informed decisions and potentially save yourself a significant amount of tax.
Please note that tax regulations and allowances are subject to change. The information provided in this blog is based on current regulations as of 6 February2024. Always consult with a qualified tax advisor for personalised advice and ensure you have the latest information.
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