Accredited official statistics

Capital Gains Tax commentary

Updated 1 August 2024

Key points

In the 2022 to 2023 tax year, the total Capital Gains Tax (CGT) liability was £14.4 billion for 369,000 taxpayers, realised on £80.6 billion of gains. This represents decreases in CGT liability and number of taxpayers of 15% and 8% respectively from the 2021 to 2022 tax year.

Although total CGT liability decreased in the 2022 to 2023 tax year, liabilities realised on residential property disposals increased.

Most CGT comes from the small number of taxpayers who make the largest gains. In the 2022 to 2023 tax year, 41% of CGT came from those who made gains of £5 million or more. This group represents less than 1% of CGT taxpayers each year.

In the 2022 to 2023 tax year, broadly speaking, as income and size of gain increased, the number of individual taxpayers decreased. In that year, 44% of gains for CGT-liable individuals came from the 11% of individuals with taxable incomes above £150,000, the additional rate threshold for Income Tax.

8% of CGT came from disposals that qualified for Business Asset Disposal Relief (BADR). BADR was claimed by 44,000 taxpayers on £12.5 billion of gains in the 2022 to 2023 tax year, resulting in CGT liabilities of £1.2 billion.

London and the South East of England accounted for around half of total gains (48%) and CGT liability (50%) in the 2022 to 2023 tax year. These figures are broadly constant over time and there is a stable regional distribution overall.

More detailed information is now available for the 2021 to 2022 tax year. In that year, CGT taxpayers disposed of 1.7 million assets worth £217 billion and realised gains of £93.9 billion. Financial assets accounted for 85% of disposals, 74% of disposal proceeds, and 79% of gains.

The CGT on UK Property service was used by 122,000 taxpayers to report 134,000 disposals of residential property in the 2023 to 2024 tax year for a total CGT liability of £1.6 billion. This is a decrease from the 2022 to 2023 tax year, reflecting trends in the wider residential property market.

About this release

This publication is the annual update of the Capital Gains Tax statistics. The statistics include information on the number of capital gains taxpayers, capital gains, tax liabilities, and Business Asset Disposal Relief and Investors’ Relief taken from Self Assessment returns, as well as breakdowns by size of gain, taxable income, region, and age up to the 2022 to 2023 tax year. Only information from taxpayers who have a CGT liability is included in the publication.

Updates have been made to the previous provisional figures and new information is provided for the 2022 to 2023 tax year.

Breakdowns by holding period and type of asset disposed of are also provided for the 2021 to 2022 tax year from sample information. The publication also includes statistics on the CGT on UK Property service, including new information on residential property disposals made in the 2023 to 2024 tax year and updating provisional figures for the previous 3 tax years.

Data sources, definitions, and methods are described in more detail in the Background Quality Report.

National statistics are accredited official statistics.

Commentary

This section provides the headline statistics about CGT taxpayers. Tables 1 to 6 are based on Self Assessment and CGT on UK Property returns with a CGT liability and include information on tax years up to 2022 to 2023. Table 7 is based on a sample of asset-level information from Self Assessment returns submitted for the 2021 to 2022 tax year. Table 8 is based on returns submitted under the CGT on UK Property service for the 2020 to 2021 through 2023 to 2024 tax years.

Taxpayer numbers, gains and tax liabilities - Table 1

Table 1 and Figures 1 and 2 show the long-term trend in key statistics for CGT.

In the 2022 to 2023 tax year, total CGT liability was £14.4 billion, which is a decrease of 15% from the 2021 to 2022 tax year. The total amount of gains was £80.6 billion: a decrease of 14% from the previous year.

The number of taxpayers decreased by 8% to 369,000 when compared with the previous year. This total is around one percent of the number of people who pay Income Tax.

Although total CGT liabilities decreased, Table 8 shows that residential property liabilities increased in the 2022 to 2023 tax year compared to the 2021 to 2022 tax year.

From 11 March 2020, the lifetime limit of gains eligible for Business Asset Disposal Relief (BADR) (formerly known as Entrepreneurs’ Relief) was reduced from £10 million to £1 million. This meant that where a taxpayer had made disposals which met the qualifying conditions for the relief, and where the resulting gains fell above the £1 million lifetime limit, the excess gains were charged at the main CGT rates. This contributes to some of the increase in CGT liabilities in the 2020 to 2021 tax year as gains were charged at a higher tax rate under the new rules. More information on BADR can be found in Table 4.

Figure 1 shows the amount of capital gains and tax liabilities by year of disposal from the ‘Total amounts of gains’ and ‘Total amounts of tax’ columns of Table 1, which covers the period between the 1987 to 1988 and 2022 to 2023 tax years.

The main changes to CGT highlighted in Figure 1 are as follows:

• 1999 to 2000: CGT rates partially aligned with rates on savings income

• 2000 to 2001: Taper Relief now matures after 4 years

• 2002 to 2003: Taper Relief now matures after 2 years

• 2008 to 2009: single 18% rate, Entrepreneurs’ Relief replaces Taper Relief and the indexation allowance is withdrawn

• 2010 to 2011: higher CGT rate of 28% introduced

• 2016 to 2017: rates reduced to 10% and 20% except for gains on carried interest and residential property

• 2020 to 2021: the BADR lifetime limit was reduced from £10m to £1m and lifetime gains above £1m were charged at the main CGT rates

Further details on past changes to CGT can be found in Annex A of the Background Quality Report.

Figure 2 shows the number of taxpayers liable to CGT by year of disposal from the ‘Total taxpayers’ column of Table 1, which covers the period between the 1987 to 1988 and 2022 to 2023 tax years.

Methodology - Definition of gains over time

In Table 1 users should be aware that the definition of gains is not comparable over the long time series provided. Only gains from the 2008 to 2009 tax year onwards are reported on a consistent basis.

For years up to the 1997 to 1998 tax year, ’Gains’ are defined as the sum of chargeable gains from all disposals made by a taxpayer—having deducted indexation allowance, other reliefs and in-year capital losses, but before deducting the Annual Exempt Amount (AEA), past capital losses, or trading losses.

For years from the 1998 to 1999 tax year, ’Gains’ refers to total taxable gains net of reliefs available at disposal, and after deduction of in-year capital losses, trading losses, past capital losses and taper relief, but before deducting the AEA.

Gains between the 1998 to 1999 tax year and the 2007 to 2008 tax year are not comparable to subsequent years. This is because Taper relief was abolished in the 2008 to 2009 tax year. Taper relief reduced the gains which were taxable by a percentage which was determined by how long the asset had been held.

Size of gain - Table 2

Tables 2.1 to 2.4 give a further breakdown of the figures in Table 1 by size of capital gain for the most recent 4 tax years. Both trusts and individuals are included in these tables.

Most CGT comes from the relatively small number of taxpayers who made the largest gains. In the 2022 to 2023 tax year, 41% of CGT came from those who made gains of £5 million or more. This proportion has fallen from 45% in the 2021 to 2022 tax year. This group represents less than 1% of CGT taxpayers each year. By comparison, the top 1% of Income Tax payers in the 2022 to 2023 tax year paid an estimated 29% of all Income Tax.

Approximately one third of CGT taxpayers have gains under £25,000 and this group contributes around 1% of total CGT.

There were decreases in gains and tax between the 2021 to 2022 and 2022 to 2023 tax years in all but the lowest gain bands, with the £5 million and above category contributing 67% of the total decrease.

Size of gain by income - Table 3

Tables 3.1 to 3.4 show the distribution of taxpayer numbers and gains broken down by size of capital gain and taxable income for individuals. These tables do not include trusts.

There is a pattern to the distribution, with larger numbers of individuals making smaller gains falling into the lower income categories, and as income and size of gain increase, the number of taxpayers decreases. Individuals making large gains are also more likely to have higher incomes—individuals with gains in excess of £1 million are most likely to have incomes of at least £200,000.

In the 2022 to 2023 tax year, individuals with gains under £50,000 and taxable income below £37,700 contributed 5% of the total gains and represented 38% of those liable to CGT. In this year, 44% of gains for individuals came from the 11% of CGT-liable individuals with taxable incomes above £150,000—the additional rate threshold for Income Tax. Furthermore, 38% of overall gains were made by those with gains in excess of £1 million and income in excess of £150,000. This group represents 1% of individuals liable to CGT.

The amount of taxable income as presented in Table 3 cannot be directly used to determine a taxpayer’s Income Tax band. However, it is sufficient to allow us to see that higher and additional rate taxpayers tend to realise greater gains than those with lower taxable incomes. In the 2022 to 2023 tax year, an estimated 16% of all individuals paying Income Tax were higher rate taxpayers, whereas 28% of CGT-liable individuals had a taxable income of between £37,700 and £150,000. In that year, approximately 2% of all individuals paying Income Tax are estimated to be additional rate taxpayers, whereas 11% of CGT-liable individuals had a taxable income greater than £150,000.

Business Asset Disposal Relief and Investors’ Relief – Table 4

Tables 4.1 to 4.4 show the distribution of Business Asset Disposal Relief (BADR) and Investors’ Relief claims broken down by size of capital gain for individuals and trusts.

BADR was renamed from Entrepreneurs’ Relief on 6 April 2020.

The 2019 to 2020 tax year was the first year that we saw claims of Investors’ Relief, first announced in 2016. Investors’ Relief claims make up only a very small proportion of the totals presented in the tables.

There were 44,000 BADR claimants in the 2022 to 2023 tax year, a decrease of 8% from the previous year.

In that year, BADR was claimed on £12.5 billion of gains resulting in liabilities of £1.2 billion, which represents decreases of 2% and 1% respectively.

Gains eligible for BADR are concentrated amongst individuals who have larger gains. Around two thirds of gains and tax paid at the BADR rate came from the 23% of individuals with qualifying gains of £500,000 or more.

Both the amount of gains on which the relief was claimed on, and the amount of tax charged at the BADR rate decreased by around 60% between the 2019 to 2020 and 2020 to 2021 tax years due to the reduction of the relief’s lifetime limit from 11 March 2020.

Trusts have historically made up a small percentage of total BADR tax liability. In the 2022 to 2023 tax year, trusts accounted for less than 1% of total gains and tax paid at the BADR rate.

Approximately 8% of the total CGT in the 2022 to 2023 tax year came from disposals qualifying for BADR, a slight increase from 7% in the previous year.

Methodology - Definition of gains in Table 4

Gains reported in the BADR and Investors’ Relief tables are before the deduction of losses and the AEA, as reported by taxpayers in the relevant boxes on the SA108 Self Assessment tax return.

The statistics for claims of BADR and Investors’ Relief are combined. This is to improve reporting accuracy to account for cases where information provided by the taxpayer cannot be used to determine which of the 2 reliefs are being claimed. This is discussed in further detail in the Background Quality Report.

Changes to Table 4

To reflect the Business Asset Disposal Relief (BADR) lifetime limit reduction from £10 million to £1 million at the start of the 2020 to 2021 tax year, the tables for the three most recent tax years do not include a further breakdown for disposals with gains larger than £1m. The highest gain category for these years is for BADR claims with gains of exactly £1 million and Investors’ Relief claims with gains of £1 million and above. For the 2019 to 2020 tax year in Table 4.4, the highest category is for qualifying gains of £10 million.

Regional and country statistics - Table 5

Tables 5.1 to 5.4 show the amount of gains and tax liabilities for individuals by region and UK country. This table is based on the postcode of the residence of the individual, and therefore not necessarily the location of the asset which has been disposed.

In all years presented, the South East of England and London had the highest number of CGT taxpayers. Taken together, these two regions made up 37% of individuals who were liable to CGT in the UK in the 2022 to 2023 tax year. The North East of England and Northern Ireland had the fewest taxpayers.

London and the South East of England accounted for approximately half of the total gains (48%) and CGT liability (50%) in the 2022 to 2023 tax year. These figures are broadly constant over time and there is a stable regional distribution overall.

Age statistics - Table 6

Tables 6.1 to 6.4 show the number of taxpayers and amounts of gains and tax by age category.

The 55 to 64 age group has consistently had the most CGT taxpayers and, along with the 45 to 54 age group, has the most gains and liabilities. These 2 age groups represented 47% of the CGT-liable population and contributed around 60% of the gains and tax in the 2022 to 2023 tax year. The oldest and youngest age categories have the least amounts of gains and tax in this year. These patterns are consistent throughout the period covered in the tables.

Statistics by asset type in the 2020 to 2021 tax year - Table 7

Tables 7.1 to 7.7 show the number of disposals, disposal proceeds and gains arising in the 2021 to 2022 tax year.

Table 7.1 shows that, in total, CGT payers disposed of 1.7 million assets worth £217 billion with gains of £93.9 billion in the 2021 to 2022 tax year. This represents a 10% rise in disposal proceeds and a 16% rise in gains from the 2020 to 2021 tax year, despite the number of assets being disposed of falling by 15%.

Financial assets

In the 2021 to 2022 tax year, financial assets accounted for 85% of all disposals, 74% of the total disposal proceeds and 79% of total gains. These proportions have decreased from the previous year.

The overall decrease in the number of CGT-liable disposals in the 2021 to 2022 tax year was due to fewer financial assets being disposed of. The number of financial assets disposed of was 1.4 million, a decrease of 21% from the previous year.

The disposal proceeds and gains from financial assets were £162 billion and £74.2 billion. While this represents no change in disposal proceeds from the previous year, it represents a 10% increase in gains.

The number of disposals, disposal proceeds and gains all decreased for listed shares from the previous year but increased for unlisted shares. Unlisted shares accounted for 63% of gains made on financial assets and 41% of disposal proceeds in this category. Gains as a percentage of disposal proceeds for unlisted shares are particularly high at 71%.

Non-financial assets

Residential land and buildings were the largest component of non-financial assets in the 2021 to 2022 tax year and accounted for 78% of disposals, 78% of the total value of all disposals, and 61% of gains across this category. The number of residential property disposals, disposal proceeds and gains all increased on the previous year.

Holding periods

Of assets with known holding periods, 77% of listed shares and 67% of unlisted shares were sold within the first 5 years. Both percentages are higher than the proportion of residential land and buildings, and commercial and agricultural land and buildings held for 5 years or less, at 19% and 8% respectively.

The median average holding period is between one and 2 years for listed shares and between 3 and 4 years for unlisted shares. For both residential land and buildings and agricultural, commercial, or industrial land and buildings, the median holding period is between 10 and 15 years.

Methodology - Table 7

Table 7 is based on information on taxpayers with a CGT liability which is derived from an annual stratified sample of additional information pages submitted alongside Self Assessment capital gains schedules, as well as administrative data collected from CGT on UK Property returns.

For the annual sample of Self Assessment additional information pages, detailed calculations of gains are obtained for each case sampled. Typically, these show the amounts arising from disposals of different types of assets, the period for which they were held, the cost of acquiring each asset, enhancement expenditure (e.g. expenditure on the development of a house), the sale price and cost of disposal, and any other allowances or reliefs. The total capital gains value estimated from the sample is then scaled to match the total capital gains of all CGT Self Assessment returns for the tax year.

Equivalent asset-level data is also collected from 50,000 CGT on UK Property returns submitted by taxpayers who did not also submit a Self Assessment return.

Using experimental methodology, the 2 data sources are then combined to produce the provisional estimates presented in Table 7. The data capture process and statistical methodology are described in more detail in the Background Quality Report.

All percentages quoted in the commentary relating to holding periods are for where the holding period is known; assets with unknown holding periods are taken out of the percentage calculation.

Changes to Table 7

The 2024 publication is the second publication in which Table 7 contains information from the CGT on UK Property service, which was introduced on 6 April 2020. Prior to this, all CGT-liable UK property disposals were reported through Self Assessment and were therefore within the scope of the sample of additional information pages. The process for including this new data source is experimental, and Table 7 estimates for the 2021 to 2022 tax year are provisional and subject to revision due to potential methodological refinements. The change is described in more detail in the methodology section above as well as the Background Quality Report.

Due to a substantially higher average number of disposals per taxpayer compared to previous years, the size of the sample for 2021 to 2022 was reduced from approximately 7,500 taxpayers to approximately 5,700. This sample size allows us to obtain reliable results but may result in some additional statistical variability compared to earlier survey datasets. The total number of assets for which information was captured remains high at around 84,000 compared to around 50,000 for publications prior to 2023. The sample data used in Table 7 in the 2023 publication was similarly affected by higher average number of disposals per taxpayer.

Table 7 and Table 8 comparison

Tables 7 and 8 in the 2024 publication both contain information on the number of residential property disposals and gains for residential property for the 2021 to 2022 tax year. However, the figures in both tables are not directly comparable. Table 8 includes only information on disposals reported through the CGT on UK Property service whereas Table 7 also covers residential property disposals reported exclusively via Self Assessment. More information on the data sources used in the production of these tables is available in the Background Quality Report.

Statistics on UK residential property - Table 8

The CGT on UK Property service was introduced on 6 April 2020. Individuals, trustees and personal representatives of deceased persons who sell or otherwise dispose of UK residential property where CGT is due on all or part of the gain are required to report the disposal to HMRC within 60 days of completing the disposal, and at the same time make a payment on account of the CGT due. The filing deadline was extended from 30 days to 60 days for transactions completed on or after 27 October 2021.

Tables 8a.1 to 8a.4 show the number of taxpayers who have reported a tax liability using the CGT on UK Property service for the tax years 2020 to 2021 through 2023 to 2024. The tables also show the total gains and tax liabilities reported through this service as well as the number of returns submitted and disposals made.

Tables 8b.1 to 8b.4 show the data for each tax year broken down by month of disposal.

For the 2023 to 2024 tax year, 122,000 taxpayers reported CGT-liable residential property disposals via the CGT on UK Property service, filing 130,000 returns and reporting 134,000 disposals. These numbers represent an 18% decrease from the previous year which reflects a similar trend in the wider residential property market. Wider residential property trends are discussed in the Quarterly Stamp Duty Land Tax statistics. Total gains and total CGT liability reported through the service have decreased by 29% and 21% to £6.9 billion and £1.6 billion respectively.

In the 2023 to 2024 tax year the CGT Annual Exempt Amount (AEA) was reduced from £12,300 to £6,000. This means that taxpayers who have realised gains in this range are now liable for CGT and included in the tables for this tax year. This partially offsets the overall decrease in the number of taxpayers and disposals from the previous year. The offsetting effect is less pronounced for gains and tax reported as the newly affected taxpayers have smaller than average gains.

In addition, the reduction in the AEA means that taxpayers realising gains of more than £12,300 will have a greater proportion of their gains taxed. This does not affect the amount of gains presented in the table as they are reported before the deduction of the AEA, but it does result in these taxpayers reporting more CGT which partially offsets the overall decrease in CGT from the previous year.

Some residential property disposals are reported exclusively via Self Assessment in the years presented in the table. Information associated with these disposals is not reflected in Table 8 but is included in the totals for Tables 1 to 7 for the years covered.

Methodology - Table 8

The statistics in Table 8 are based on returns submitted using the CGT on UK Property service. The tables are produced using data from all returns submitted by UK residents who have reported at least one CGT-liable residential property disposal in the tax year presented by the individual table.

The number of disposals in Table 8 may not be equal to the total number of properties disposed of. This is because multiple taxpayers can report a disposal of their share of a jointly owned property is separate tax returns.

The number of reported disposals and associated statistics in this table are subject to change due to:

• the inclusion of late and amended returns

• changes to gains and liabilities figures following the submission of Self Assessment returns by customers with other capital gains, losses, and reliefs

• changes to income estimates that affect CGT rates charged

• any methodological updates

A small number of data points have been omitted from the statistics due to data quality issues.

Contact details

Statistical contacts

M Minev, T Penny

Media contact

[email protected]

Publication date

1 August 2024

Next publication date

August 2025

Frequency

Annual

UK Theme

Economy