Capital Gains Tax: annual exempt amount for tax year 2019-20
Published 29 October 2018
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This publication is available at https://www.gov.uk/government/publications/capital-gains-tax-annual-exempt-amount-for-tax-year-2019-to-2020/capital-gains-tax-annual-exempt-amount-for-tax-year-2019-20
Who is likely to be affected
Individuals, trustees of settlements and the personal representatives of deceased persons who have capital gains.
General description of the measure
This measure increases the Capital Gains Tax annual exempt amount to £12,000 for individuals and personal representatives and £6,000 for trustees of settlements for the period 2019 to 2020.
Policy objective
The annual exempt amount is increased annually to keep pace with inflation in-line with rises in the Consumer Prices Index (CPI).
Background to the measure
This measure was announced at Autumn Budget 2018.
Detailed proposal
Operative date
This measure will have effect in relation to gains accruing on or after 6 April 2019.
Current law
The rules for the annual exempt amount are part 1, section 3 of the Taxation of Chargeable Gains Act (TCGA) 1992. Section 3 provides that the annual exempt amount which is presently set at £11,700, is increased annually in line with increases in CPI, rounded up to the nearest multiple of £100. It also provides that the annual exempt amount available to most trustees of settlements is one half that due to individuals, effectively £5,850.
Proposed revisions
Legislation will be introduced in Finance Bill 2018 increasing the annual exempt amount to £12,000. This will also have the effect of increasing the annual exempt amount for trustees of settlements to £6,000.
Summary of impacts
Exchequer impact (£m)
| 2018 to 2019 | 2019 to 2020 | 2020 to 2021 | 2021 to 2022 | 2022 to 2023 | 2023 to 2024 |
|---|---|---|---|---|---|
| nil | nil | nil | nil | nil | nil |
This measure is not expected to have an Exchequer impact.
Economic impact
This measure is not expected to have any significant economic impacts.
Impact on individuals, households and families
This measure is expected to have minimal impact on individuals as it simply increases the existing annual exempt amount in-line with CPI.
This measure is not expected to have an impact on family formation, stability or breakdown.
Equalities impacts
It is not anticipated that this measure will impact on groups sharing protected characteristics.
Impact on business including civil society organisations
This measure is expected to have no impact on businesses or civil society organisations as it only affects individuals and trustees who pay Capital Gains Tax in their personal capacity, and personal representatives who pay Capital Gains Tax in their professional capacity on behalf of an individual.
Operational impact (£m) (HMRC or other)
HMRC processing systems are designed to accommodate tax changes. The change will not increase HMRC processing or compliance resource.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
This measure will be monitored through information collected from tax receipts.
Further advice
If you have any questions about this change, please contact Nick Williams on Telephone: 03000 585 660 or email: [email protected].