Capital Gains Tax

The annual exempt amount is increased to £10,100 for individuals (£5,050 for most trustees) for 2010/11.

The starting rate of CGT remains at 18%  For higher-rate taxpayers, and for gains that take the total taxable income and gains into the 40% rate, the proportion of the gain above the basic-rate threshold will be taxed at 28%.

Entrepreneurs’ Relief reduces the effective rate of tax on qualifying gains to 10%. Entrepreneurs’ Relief will apply to gain arising on the sale of a qualfying business.

The first £2,000,000 (2009/10 £1,000,000) of Capital Gains, that qualifies for "entrepreneurs releif", will be taxed at an effective rate of 10%. The £2,000,000 "entrepreneurs releif" is a lifetime relief. Individuals will be able to claim on more than one occasion until the £2,000,000 limit is reached. Any further capital gains in excess of the £2,000,000 limit will be taxed at the normal rate of 18%.