Capital Gains Allowance 2026/27: How the £3,000 Rule Works

What is the capital gains allowance for 2026/27?

The capital gains allowance, officially called the annual exempt amount, is £3,000 for 2026/27. It is the amount of profit, called a gain, that you can make when you sell or give away assets in one tax year before capital gains tax applies. Most trustees get £1,500. Trustees for a disabled person, and personal representatives, get the full £3,000.

The allowance applies to your total gains for the year, added up across everything you dispose of, after losses. A disposal means selling an asset, giving it away (except to your spouse, civil partner or a charity), swapping it, or receiving compensation for it, such as an insurance payout for something destroyed.

The assets most households pay this tax on are shares and funds held outside an ISA, including a global index fund held in a general investment account, property that is not your main home, business assets, cryptoassets, and personal possessions worth £6,000 or more, apart from your car. Gains inside ISAs, including a Lifetime ISA, are never taxed, and neither are Premium Bonds or UK government gilts, as GOV.UK’s rates and allowances guidance sets out.

The allowance has been cut hard and fast, which is why people who never owed this tax before now do:

What are the capital gains tax rates for 2026/27?

From 6 April 2026, gains are taxed at 18% or 24%, whatever the asset, including residential property. The part of your gains that fits inside your unused basic rate income tax band is taxed at 18%, and anything above it at 24%. Trustees and personal representatives pay 24% on everything.

Your gains sit on top of your income. The basic rate band for 2026/27 is £37,700 of taxable income, so if your taxable income already fills that band, every pound of gain is taxed at 24%. If part of the band is spare, that part of your gain gets 18%. Your allowance is set against the gains taxed at the highest rate first, which keeps the bill as low as the rules allow. Your income decides your rate, so it helps to understand how UK tax codes and income tax bands work before you sell.

Business Asset Disposal Relief and Investors’ Relief are both charged at 18% for 2026/27, each with a £1 million lifetime limit, as GOV.UK’s Business Asset Disposal Relief page confirms. The rate was 14% in 2025/26, and some guides still print the old figure. For a 2026/27 disposal, 18% is the number.

Worked example: you sell shares held outside your ISA and make a £4,000 gain, your only disposal this year. Take off the £3,000 allowance and £1,000 is taxable. At 18% the tax is £180. At 24% it is £240. Four years ago the same gain would have been fully covered by the £12,300 allowance and taxed at nothing.

Do couples get two capital gains allowances?

Yes. Married couples and civil partners each have their own £3,000 allowance, and assets can be passed between them with no tax charged at the transfer, on what is called a no gain, no loss basis. Hold an asset jointly, or move it into joint names before a sale, and a couple can shelter £6,000 of gain between them.

The partner who receives the asset takes over the original buying cost, so the gain is worked out from when the couple first acquired it, not from the transfer date. The transfer has to be genuine: from then on, your partner really owns their share, including if you later separate.

Worked example: a jointly held asset, such as shares or a second property, is sold with an £11,000 gain. Each partner’s share is £5,500. Each uses their own £3,000 allowance, leaving £2,500 taxable each, £5,000 in total. At 24% the couple pays £1,200. One person holding the same asset alone has £11,000 minus £3,000, which is £8,000 taxable, and pays £1,920 at 24%. Splitting the asset saves £720. At 18% the couple pays £900 against £1,440 for a single holder, a saving of £540.

Do losses come off before or after the allowance?

Before. Losses from the same tax year must be taken off that year’s gains in full, even if doing so pulls your gains below the £3,000 allowance. Losses brought forward from earlier years work the other way round: they are used only enough to bring your gains down to the allowance level, so none of your allowance is wasted.

A loss only counts once you claim it, and you must claim within 4 years of the end of the tax year in which the loss arose. Miss that deadline and the loss can never be used. Once claimed, any part of a brought-forward loss you do not need yet carries forward indefinitely, as GOV.UK’s losses page explains. Keep records of what you bought and sold, and the dates: a claimed loss is worth real money against a future gain.

Do I have to report a gain that is below the allowance?

Often no, but not always. If you are registered for Self Assessment, you must report your disposals when your total gains before losses exceed £3,000, or when everything you sold in the year fetched more than £50,000 in total, even if no tax is due after the allowance and losses.

The £50,000 figure is the total proceeds, what the assets sold for, not the profit on them. Sell £60,000 of shares for a £2,000 gain and you still have to report it, because the proceeds pass the trigger, even though the gain sits inside your allowance and the tax bill is nil. If you are not in Self Assessment, no tax is due, and your proceeds stay under £50,000, there is normally nothing to file. GOV.UK’s work out if you need to pay page walks through the test.

Selling a property? The 60-day rule

If you sell a UK residential property and capital gains tax is due, you must report the sale and pay the tax within 60 days of completion, using HMRC’s separate property service. You do not wait for your annual tax return, although the payment is then credited in that return. No 60-day report is needed where no tax is due.

One point some guides word badly, so here it is plainly: selling a property that is not your main home is not exempt. Second homes and buy to let properties are exactly what this tax catches. Your main home is normally covered by main residence relief, but a home you have let out, used for business, or with very large grounds can be partly taxable. GOV.UK’s report and pay page is where the 60-day service starts.

What it means for your money

The allowance is now a quarter of what it was in 2022/23, so ordinary savers and investors meet this tax much sooner. A £4,000 gain on shares used to be fully tax free. In 2026/27, £1,000 of it is taxed. If you hold investments outside an ISA, the allowance is no longer a detail. It is the line between no paperwork and a tax return plus a bill.

Three habits protect you. First, use the allowance every year: it resets on 6 April and cannot be carried forward, so spreading one large sale across two tax years uses two allowances. Second, shelter first: gains inside an ISA are never taxed at all, which is why the cash ISA versus stocks and shares ISA choice matters, and why our guide to tax free savings in the UK is worth reading before you hold large sums in taxable accounts. Third, couples should count their allowances together: £6,000 combined, arranged before a sale, is the biggest simple saving in this guide, worth £720 on an £11,000 gain at 24%.

Finally, treat records and losses as money. A loss you claim inside the 4-year window can wipe out tax on a future gain pound for pound. A loss you forget to claim is gone for good.

Frequently asked questions

What is the capital gains allowance for 2026/27?

£3,000 per person, and £1,500 for most trustees. You pay tax only on total gains above that amount, after losses, at 18% or 24%. The allowance has been £3,000 since 2024/25; it was £12,300 in 2022/23.

Can I carry my unused allowance forward?

No. The allowance applies to one tax year only. Any part you do not use by 5 April is lost, and it cannot be added to the next year’s allowance. This is why spreading a large disposal across two tax years can cut the bill.

Do I pay capital gains tax when I sell my main home?

Normally no. Main residence relief covers the home you live in as your only or main home. Part of the gain can become taxable if you let the property out, used part of it only for business, or it has very large grounds.

Can I use my partner’s allowance if I have used mine?

Not directly. Allowances are personal and cannot be transferred. But spouses and civil partners can pass assets between them with no tax at the transfer, so if the asset is genuinely shared before the sale, each partner’s own allowance applies to their share.

What happens if I sell something at a loss?

You can claim the loss and set it against gains. Losses from the same year come off in full first; losses from earlier years are then used down to the allowance level. You must claim within 4 years of the end of the tax year the loss arose in, or it is lost.

Do I get the allowance if I claim the foreign income and gains regime?

No. Anyone who claims the foreign income and gains (FIG) regime, or Overseas Workday Relief, for a tax year does not get an annual exempt amount for that year.

Sources: GOV.UK, Capital Gains Tax rates and allowances; Capital Gains Tax: work out if you need to pay; Capital Gains Tax losses; Report and pay your Capital Gains Tax; Business Asset Disposal Relief, all checked 18 October 2026. This guide covers capital gains tax law for 2026/27 as it stands today. General information, not personal financial advice.