Capital Gains Tax (CGT) can have a significant impact on individuals, landlords, and business owners when selling or transferring assets. Understanding how CGT works – and more importantly, how to reduce your tax bill using legitimate reliefs and exemptions – is an essential part of good financial planning.
At Dunkley’s Accountants in Bristol, we regularly provide tailored tax advice to help clients manage CGT effectively. In this blog, we outline the key reliefs available and how they can be used to support your financial goals.
What is Capital Gains Tax?
CGT is a tax on the profit you make when you sell or “dispose of” an asset that has increased in value. It applies to personal possessions worth over £6,000 (except your car), property that’s not your main home, shares, and business assets.
As of the 2025/26 tax year, individuals can make up to £3,000 in capital gains before paying any CGT. For most trusts, the exempt amount is £1,500. Gains above this threshold are taxed at 18% or 24%.
With the annual allowance now significantly reduced, it’s more important than ever to plan ahead and take advantage of available reliefs.
Common CGT Reliefs and Exemptions
- Private Residence Relief
If the asset you’re selling is your only or main home, you may be entitled to full or partial relief from CGT. Certain conditions apply, especially if the property has been rented out or not occupied throughout the period of ownership.
- Business Asset Disposal Relief (BADR)
Formerly Entrepreneurs’ Relief, BADR allows individuals selling a business or shares in a personal company to pay 14%, (which will rise to 18% on 6th April 2026) up to a lifetime limit of £1 million. This is particularly valuable for owner-managed businesses planning for succession or retirement.
- Rollover Relief
This relief allows you to defer CGT when you sell a business asset and reinvest the proceeds in another qualifying business asset. It’s commonly used when replacing commercial premises or reinvesting in machinery.
- Gift Hold-Over Relief
If you’re gifting business assets or shares in a personal company, this relief lets you defer the gain, passing the CGT liability to the recipient. It’s especially useful for those planning to transfer assets within the family or as part of succession planning.
How Dunkley’s Can Help
Tax rules around CGT are complex, and the reliefs available can vary depending on timing, type of asset, and personal circumstances. At Dunkley’s, our experienced tax team offers proactive, strategic accountancy support to clients across Bristol and the South West.
We help you:
- Calculate your CGT position accurately
- Maximise reliefs and exemptions
- Ensure HMRC compliance
- Plan asset disposals tax-efficiently
Whether you’re planning to sell a second home, pass on business shares, or restructure your investments, our team is here to help you minimise your tax exposure and keep your finances on track. Get in touch today on 01454 619900 or email advice@dunkleys.accountants.