Mark McLaughlin looks at planning using the capital gains tax annual exemption.
The capital gains tax (CGT) annual exemption is a welcome and useful tax break for many taxpayers.
It is generally available to individuals (i.e. £12,000 for 2019/20), personal representatives (for the tax year of death and the two following years) and trustees (albeit the maximum entitlement is generally one-half of the exemption for individuals; see TCGA 1992, Sch 1C). This article focuses on individuals.
Don’t waste it!
The CGT annual exemption is a ‘use it or lose it’ allowance, in the sense that any unused exemption for one tax year cannot be carried forward (although it can be carried back to a limited extent on death).