Pre Budget Report 2007 - Capital Gains Tax (CGT)
From 6 April 2008 there is to be a dramatic change in the calculation of Capital Gains Tax (CGT). Essentially there will be a flat rate of tax of 18% based on the difference between sale proceeds and cost. This applies irrespective of the type of asset held; the length of time held; removes relief for indexation totally (effectively halving the tax base cost for assets held pre March 1982) and removes a few other mitigation measures.
The Chancellor confirmed that the existing rules will apply until 5 April 2008. Depending on whether you have business assets that qualify for full taper relief (an effective rate of tax of 10%) or non-business assets (best possible rate 24%) you have either a five month window to realise a gain or a short period to wait before you sell.
This is complicated and you need to review the CGT position on assets urgently.
The changes outlined do not apply to companies.
Have you thought about signing the FPB capital gains petition. We have just signed it. http://www.fpb.org/fpbpetitions/12
Amanda
Many thanks for your comment and link to the FPB capital gains petition.
You may also recall in my previous post titled 'Changes to Capital Gains Tax - Have Your Say' there was reference to a petition that has opened on the Downing Street website. If you wish to add your name to this the link is - http://www.number10.gov.uk/output/Page1.asp
Cathy Corns