The New CGT rate for 2009-2010

Yuping

Hello everyone,

Just checked the new CGT rate for 09-10 is 18%! How to use this? I only learnt about the rates in 07-08, it was adding on the other incomes based on 10% , 20% and 40%.

Can someone help here?

sloshed

Hi

The gain is taxed at flat rate of 18%. There is no longer any taper relief.

Hope that helps

Yuping

Hi, thanks for your reply,

Do you know whether indexation allowance was still in the same old rules?
does this CGT flat rate mean we calculate income/salary tax separately?
If anywhere can I get more info about this Pls?


Many thanks

Yuping

sloshed

Hi

More information can be found here

http://www.hmrc.gov.uk/cgt/

A-Vic

Am i right in thinking as well as taper relief there isnt indexation either

sloshed

Hi

To clarify on the CGT when the 18% rate of CGT was brought in. Indexation which was replaced by taper in 1998 and taper relief was no longer allowed. The 18% rate is in effect to allow for this.

There is still a possibly to get indexation where a transfer has happened between related parties prior to 1998 but this is a bit complicated and if you need details please send me a PM.

It is of course different for companies.

Hope that helps.

Brian

deanshepherd

Interesting. I thought indexation had gone altogether.

In what circumstances does it still apply for individuals?

sloshed

Husband buys an asset in 1993 for say £100K. Transfers to wife in 2002. She sells the shop in say October 2008

The transfer in 2002 would be £100,000 plus Indexation of £15,200. Wife then has a base cost of £115,200 and has obtained the benefit of indexation allowance

deanshepherd

Ah I see. I wouldn't categorise that as gaining a benefit of indexation allowance now, rather in 2002 under the rules in place at that time.