Capital Gains Tax is a tax on the profit when you sell (or ‘dispose of’) something (an ‘asset’) that’s increased in value. It’s the gain you make that’s taxed, not the amount of money you receive.

Capital Gains Tax allowances

You only have to pay Capital Gains Tax on your overall gains above your tax-free allowance (called the Annual Exempt Amount).The tax-free allowance is:

Capital Gains Tax rates

You pay a different rate of tax on gains from residential property than you do on other assets. You don’t usually pay tax when you sell your home. If you're a basic rate taxpayer you'll pay 18% capital gains tax on property sales. Higher-rate and additional-rate taxpayers will pay 28%.

For year 2017-18 capital gains tax rates remain at 18% and 28% for property sales even though they have fallen to 10% and 20% for other capital gains.

Tax relief if you let out your home

If you have let out part or all of your home, when you sell it, a proportion of any gain will relate to the letting and could be taxable.

However, provided the home genuinely has been your main home at some point, you can claim tax relief for the time it was your main residence, plus the past 18 months of ownership.