Capital Gains Tax Rates 2026/27: UK Bands, Brackets & Worked Examples

Capital gains tax (CGT) in the UK is not charged in fixed brackets the way income tax is. Instead, the rate that applies to your gain depends on two things: your taxable income for the year, and the type of asset you have sold. This guide explains the 2026/27 capital gains tax rates, how the “brackets” effectively work, and walks through worked examples for shares, residential property and business assets.

CGT rates for 2026/27 at a glance

Asset type	Basic-rate taxpayer	Higher / additional-rate taxpayer
Shares (outside ISA/pension), most other assets, crypto	10%	20%
UK residential property (not main home)	18%	24%
Qualifying business disposal with BADR	10% (up to £1m lifetime)	10% (up to £1m lifetime)
Qualifying disposal with Investors’ Relief	10% (up to £10m lifetime)	10% (up to £10m lifetime)

The annual exempt amount (CGT allowance) for 2026/27 is £3,000 per individual. Gains above that, after reliefs and losses, are taxed at the rates in the table.

How CGT “brackets” actually work

The reason CGT is not really a bracket system is that the rate is decided by your income tax band, not by the size of the gain. But because the gain effectively sits on top of your income for this purpose, large gains can straddle bands — part of the gain taxed at the lower rate, part at the higher rate.

The mechanism in detail:

1. Work out your taxable income for the year (income after the personal allowance and other reliefs).
2. Compare that to the basic-rate band limit (£37,700 above the personal allowance for 2026/27, so £50,270 total taxable income).
3. The amount of basic-rate band you still have unused is the amount of your taxable gain that can fall into the lower CGT rate (10% or 18%).
4. Any gain above that uses the higher CGT rate (20% or 24%).

Worked example 1: gain entirely in the basic rate band

Tom has £25,000 of taxable income for 2026/27 (a salary of £37,570 less his £12,570 personal allowance). He sells some shares (held outside an ISA) for a gain of £8,000.

Gain                       £8,000
Less: annual allowance     £3,000
                          --------
Taxable gain               £5,000

Basic-rate band remaining: £37,700 - £25,000 = £12,700
The entire £5,000 gain fits inside the basic-rate band.
CGT @ 10%                  £500

Tom owes £500 in CGT.

Worked example 2: gain that straddles the basic and higher bands

Priya has £40,000 of taxable income for 2026/27. She sells a share portfolio for a gain of £25,000.

Gain                       £25,000
Less: annual allowance      £3,000
                           --------
Taxable gain                £22,000

Basic-rate band remaining: £37,700 - £40,000 = NEGATIVE
Priya is already a higher-rate taxpayer on her income, so:
CGT @ 20% on £22,000     = £4,400

If Priya had only £30,000 of taxable income, the calculation would split:

Basic-rate band remaining: £37,700 - £30,000 = £7,700
First £7,700 of gain @ 10%   = £770
Remaining £14,300 of gain @ 20% = £2,860
Total CGT                     = £3,630

Worked example 3: residential property at the higher rate

Mark sells a buy-to-let property in May 2026. After all allowable costs, the gain is £85,000. He is an additional-rate taxpayer on his employment income.

Gain                       £85,000
Less: annual allowance      £3,000
                           --------
Taxable gain                £82,000

Residential property + higher/additional rate = 24%
CGT @ 24% on £82,000     = £19,680

Mark must report and pay this CGT within 60 days of completion using HMRC’s UK Property service — not at his usual Self Assessment deadline.

Why your CGT rate is not just about the size of the gain

A common misunderstanding is that bigger gains automatically attract a higher CGT rate. They do not — directly. What matters is:

• The asset type (residential property is taxed higher).
• Your income tax band (basic vs higher/additional).
• How much of your basic-rate band remains to soak up some of the gain at the lower rate.

This is why timing and income management can make a real difference. If you can defer a bonus, contribute more to a pension (which reduces taxable income), or split a disposal across tax years, you may keep more of the gain in the lower CGT band.

Special CGT rates: BADR and Investors’ Relief

Two important reliefs replace the standard rate with a flat 10% — but only for qualifying business disposals:

Business Asset Disposal Relief (BADR) — formerly Entrepreneurs’ Relief. 10% rate up to a £1 million lifetime limit on qualifying disposals of:

• All or part of a trading business you have owned for at least two years;
• Shares in a personal trading company (you must own 5%+, be an officer or employee, and the company must be trading);
• Assets used by your business after cessation, if disposed within 3 years.

Investors’ Relief — 10% rate up to a separate £10 million lifetime limit for external investors in unlisted trading companies, where shares are held continuously for at least three years and were subscribed for as new shares.

Both reliefs have detailed qualifying conditions and traps. Before any business sale or significant share disposal, get tax advice — the difference between BADR and the standard rate on a £1m gain is £100,000.

CGT rates and Scottish taxpayers

Although Scotland sets its own income tax rates and bands, capital gains tax is a UK-wide tax — the CGT rates (10%, 20%, 18%, 24%) are the same wherever you live in the UK. However, whether you are a “higher-rate taxpayer” for CGT purposes can be affected by Scottish income tax in some scenarios. Practical impact is usually small, but for borderline cases involving Scottish taxpayers it is worth checking with an adviser.

CGT rates compared with income tax

It is worth knowing how CGT rates compare with the equivalent income tax rates. For 2026/27:

Band	Income tax rate	CGT (most assets)	CGT (residential property)
Basic rate	20%	10%	18%
Higher rate	40%	20%	24%
Additional rate	45%	20%	24%

CGT is generally lower than income tax. This is one reason careful structuring of an asset-rich exit (such as selling a business) can leave significantly more in your pocket than taking the same amount as dividends or salary.

FAQ

What is the CGT rate for higher-rate taxpayers in the UK? For most assets, 20%. For UK residential property that is not your main home, 24%. The annual allowance of £3,000 applies first.

What is the basic-rate CGT rate? 10% for most assets, 18% for residential property. To pay at this rate, your total taxable income plus your taxable gains must fit within the basic-rate band (£37,700 above the personal allowance for 2026/27).

Are there separate CGT brackets like income tax? Not formally. Your gain effectively sits on top of your income; the amount within the basic-rate band is taxed at the lower CGT rate, the rest at the higher CGT rate.

How does CGT work on a part-business sale? A sale of part of a business can qualify for Business Asset Disposal Relief if conditions are met, applying a flat 10% rate up to the £1 million lifetime limit. Below the limit, the standard 10% or 20% rate applies. Always get pre-deal advice — qualifying conditions are easy to fail by accident.

Do these CGT rates apply to companies? No. UK companies do not pay capital gains tax. Instead, gains on disposals of capital assets are subject to corporation tax, at the corporation tax rate (currently 25% for profits over £250,000, 19% for small profits up to £50,000, with a marginal calculation in between). The mechanics are different from individual CGT.

Get clarity on your CGT position

If you are about to sell shares, a property or a business, get the figures right before you commit. We help individuals, landlords and business owners with capital gains tax calculations, BADR claims, 60-day property reporting and full tax planning.

Try our free CGT calculator, book a free consultation, or read more about our capital gains tax and self assessment services.

For the official rules, see GOV.UK: capital gains tax rates.