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What is Capital Gains Tax annual exempt amount?
Last verified 23 October 2026
The annual exempt amount is the gain you can make each tax year before paying Capital Gains Tax. For individuals it is £3,000 for 2026 to 2027.
Why it matters to landlords
It was £6,000 in 2023 to 2024 and has been £3,000 since 2024 to 2025. Most trustees get £1,500. The allowance is set against your total taxable gains for the year, so selling a rental property usually uses it all at once. Each owner has their own allowance, so joint owners each set it against their own share of the gain.
Whatever is left after the allowance is added to your taxable income to decide the rate. For 2026 to 2027 the gain is taxed at 18% where it falls within the basic rate band and 24% above it. If you sell UK residential property and tax is due, you must report and pay within 60 days of completion. If you sell more than one asset in a year, the one allowance covers all of them.
Example
A couple sell a jointly owned rental flat with a £40,000 gain, split equally. Each has a £20,000 gain, deducts the £3,000 allowance and is taxed on £17,000.
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Related terms
- Capital Gains Tax (CGT)
- 60 day Capital Gains Tax reporting
- Joint ownership and Form 17
- Private residence relief
- Declaration of trust