Capital gains tax brought in £24.3bn in 2025-26, more than three times the amount raised in 2017-18, as the annual exempt amount fell to £3,000 and pulled more taxpayers into the net. The lower threshold means gains that once slipped through now face tax, even before people get to the higher rates of 24% and, in some cases, 18%.
That is why Capital Gains Tax is drawing attention now: the rules have changed, the allowance refreshes every tax year, and more households are discovering that the tax is not just for the wealthy. Clare Stinton called it “a decent cash machine for the taxman”, and the numbers back that up, with receipts up from £13.7bn the year before and the Office for Budget Responsibility expecting them to reach £35bn in 2030-31.
Capital gains tax is charged on the profit made when you sell or dispose of something that has risen in value, including investments not held in an Isa, property that is not your main home, and most personal possessions worth £6,000 or more apart from your car. The allowance was £12,300 until 2022-23, then fell to £6,000 and is now £3,000. For a gain above that, higher-rate taxpayers now pay 24%, while basic-rate taxpayers may pay 18% depending on the size of the gain and their taxable income.
The scale of the shift is easier to see in household terms. Using the £24.3bn haul, the government took about £800 a household if spread across roughly 30 million UK households. That is one reason the levy is landing far beyond investors with large portfolios. Wes Streeting last month set out plans for a wealth tax that would equalise capital gains tax with income tax, adding pressure to a system already raising more money while catching more people.
Yet the tax is not unavoidable. Married couples or civil partners can transfer investments between them to use both allowances, and people can reduce bills by offsetting losses against gains if they make the claim through a tax return. Elsa Littlewood said parents can fund a junior Isa with up to £9,000 per child each tax year, while UK residents aged 18-plus can put up to £20,000 each into an Isa, allowing a family of four to shelter £58,000 a year. She also said the same approach can make matching gains and losses cut the overall tax bill.
That leaves a simple message for savers and investors: the tax net is wider, the allowance is smaller, and the government is already collecting far more than it was a few years ago. What remains unanswered is how many more taxpayers have now been pulled into capital gains tax as the allowance keeps shrinking and receipts keep climbing.
