Calculate CGT & Stamp Duty in British Pound (GBP)
The UK operates a comprehensive capital gains tax system for property transactions, with rates varying based on taxpayer income levels and property types. Basic rate taxpayers pay 18% CGT on property gains, while higher and additional rate taxpayers face 28% CGT rates, making tax planning essential for property investors.
SDLT applies to property purchases with progressive rates from 0% to 12% based on property value. Additional 3% surcharge applies to second homes and buy-to-let properties, significantly impacting investment property acquisitions. First-time buyers receive relief on properties up to £425,000, reducing upfront costs.
UK residents can claim complete CGT exemption on their main residence through Principal Private Residence Relief, provided they lived in the property throughout ownership. Partial relief applies for periods of absence, making primary residence ownership highly tax-efficient for wealth building.
Buy-to-let investors face multiple tax implications including rental income tax, mortgage interest restrictions, and CGT on disposal. The Section 24 mortgage interest restriction phases out tax relief on mortgage interest, reducing net rental yields and affecting overall investment returns.
Each individual receives an annual CGT exemption (£6,000 for 2024-25), allowing tax-free gains up to this threshold. Married couples can utilize both allowances through strategic ownership structures, potentially saving significant CGT on property disposals through proper planning.
Non-UK residents face CGT on UK residential property gains since April 2015, with rates matching those for UK residents. This change significantly impacts international property investors, requiring careful consideration of tax obligations and potential double taxation treaty benefits.
Qualifying business properties may benefit from Business Asset Disposal Relief (formerly Entrepreneurs' Relief), offering 10% CGT rate on gains up to £1 million lifetime limit. This relief can significantly reduce tax liability for business property disposals meeting specific criteria.
Given the complexity of UK property taxation and frequent legislative changes, professional tax advice is essential for significant transactions. Proper structuring, timing, and documentation can optimize tax efficiency while ensuring compliance with HMRC requirements and maximizing after-tax returns.
Basic rate taxpayers pay 18% CGT on property gains, while higher and additional rate taxpayers pay 28%. These rates apply after deducting the annual exemption (£6,000 for 2024-25) and any allowable costs.
An additional 3% SDLT surcharge applies to second homes and buy-to-let properties on top of standard rates. This surcharge applies to the entire purchase price, significantly increasing upfront costs for investment properties.
Yes, your main residence is generally exempt from CGT through Principal Private Residence Relief, provided you lived there throughout ownership. Partial relief may apply for periods of absence or if part was used for business.
Yes, non-UK residents have been liable for CGT on UK residential property gains since April 2015. The same rates apply as for UK residents, but double taxation treaties may provide relief in some cases.
Allowable costs include purchase costs (legal fees, stamp duty), improvement costs (not repairs), and sale costs (estate agent fees, legal fees). These deductions can significantly reduce your taxable gain.