One of the most immediate and substantial changes in the Budget was an increase in the standard Capital Gains Tax (CGT) rate.
From today, the main rates of CGT will change as follows:
- Lower rate – Increases from 10 per cent to 18 per cent
- Higher rate – Increases from 20 per cent to 24 per cent
The separate CGT rates for property disposals will remain unchanged.
However, those looking to dispose of a business or a significant shareholding via a sale or succession should take note of changes to Business Asset Disposal Relief (BADR).
The CGT rates for BADR and Investors’ Relief will increase to 14 per cent from 6 April 2025 and match the main lower rate of 18 per cent from 6 April 2026.
The lifetime limit for Investors’ Relief will be reduced to £1 million for all qualifying disposals made on or after 30 October 2024, aligning it with the existing lifetime limit for Business Asset Disposal Relief.