Independent financial advice - Capital Gains Tax
Take independent financial advice about Capital Gains Tax.
When it is payable?
Capital Gains Tax (CGT) may be due when you sell certain assets, including property (if it is a second home or a rental investment), shares or other investments such as antiques, art and cars. A capital gain is generated when the asset or investment is sold, but gifts and even prizes can also attract CGT. Independent financial advice suggests that CGT only raises around £2.5 billion a year but to abolish it would open up a tax avoidance loophole that could cost the treasury considerably more.
Windfall shares
If you have been fortunate enough to receive windfall shares and you decide to sell, you must declare the full sale value as profit, and should take independent financial advice about whether you will be liable for CGT.
Disposing of assets
Independent financial advice can inform you when an asset is likely to attract CGT, but simply, you have made a gain if you sell an asset for more than you paid for it. It is the gain that is taxed, not the amount you receive. If you give an asset away, you normally look at what it is worth, not what you get for it. The same is true when you sell it for less than its full worth in order to give away part of the value. You might dispose of an asset that you had received as a gift. When you work out the gain you normally use the market value of the asset when you received it.
Which assets don't attract Capital Gains tax?
If you inherit an asset, the estate of the person who died does not pay CGT at that time. If you later dispose of the asset, you work out the gain by looking at the market value at the time of the death. If you give an asset to a registered charity you will not have to pay CGT. If you sell or give an asset to your husband or wife while you are legally married and living together, that does not give rise to a CGT charge. If your husband or wife later sells the asset, he or she will work out the CGT at that time by looking at what you paid for the asset. If you are still confused about CGT, get independent financial advice to clear up any confusion.
Tax Allowance
You are allowed to keep the first £8,500 of the profit as a tax allowance, and you can offset other losses against your tax bill. And there are exemptions :
- Jewellery, paintings and antiques worth less than £6,000
- Savings Certificates and Premium Bonds
- Betting, lottery or pools winnings
You can have a brighter financial future. If you would like independent financial advice about bridging loans call our experienced advisers today on 0870 803 1995 or e-mail mike.robertson@mraltd.com
