The capital gains tax changes 2026 taxpayers are still adjusting to did not happen all at once. They began with the Autumn Budget on 30 October 2024 and have been phased in gradually since, through 6 April 2025 and 6 April 2026. This guide sets out exactly what changed, when each change took effect, and what has stayed the same, so you can see precisely how your own disposals are affected.
Since the Budget of 30 October 2024, the main rates of Capital Gains Tax for individuals rose from 10%/20% to 18%/24%, aligning with the rates already charged on residential property.
Trustees and personal representatives moved from 20% to 24% on non-property gains. Business Asset Disposal Relief and Investors’ Relief were increased in stages, from 10% to 14% on 6 April 2025, and to 18% on 6 April 2026. Carried interest moved to a flat 32% from 6 April 2025, then was reformed again from 6 April 2026 into the Income Tax framework, with an effective rate of around 34.1%.
The 30 October 2024 Rate Rise
The single biggest of the capital gains tax changes 2026 taxpayers now face traces back to the Chancellor’s first Budget. With immediate effect from 30 October 2024, the main rates of Capital Gains Tax on assets other than residential property rose from 10% and 20% to 18% and 24%. This brought shares, business assets, and other chargeable gains into line with the rates already charged on residential property, which did not change. Trustees and personal representatives saw a parallel rise from 20% to 24% on their non-property gains.
To see exactly how these rates apply today, read our complete guide to Capital Gains Tax rates for 2026/27.
The Phased Increase to Business Asset Disposal Relief
Among the capital gains tax changes 2026 introduced, the Business Asset Disposal Relief (BADR) and Investors’ Relief rate did not rise in one step; instead the government chose a staged approach:
- On or before 5 April 2025: 10%
- 6 April 2025 to 5 April 2026: 14%
- From 6 April 2026: 18%
This means a business owner selling a qualifying company in 2026/27 now pays 18% on gains within the £1 million lifetime limit – nearly double the 10% rate that applied before October 2024, even though BADR remains the cheapest legal route to sell a business. The Investors’ Relief lifetime limit was also cut from £10 million to £1 million from 30 October 2024.
Carried Interest Moved Into the Income Tax Framework
Carried interest, the performance-related reward paid to fund managers, went through two separate reforms. It was taxed at a flat 32% from 6 April 2025, up from 18%/28% before that. Then, from 6 April 2026, carried interest was reformed again: qualifying carried interest is now treated as trading profits and taxed under the Income Tax framework (with Class 4 National Insurance), subject to a 72.5% multiplier. This produces an effective combined rate of approximately 34.1% on qualifying carried interest, replacing the Capital Gains Tax treatment entirely for most fund managers.
What Stayed the Same
Not every part of the system moved. Three important figures were untouched by the capital gains tax changes 2026 brought in from October 2024:
- Residential property rates: already 18%/24% before the Budget, and unchanged since.
- The Annual Exempt Amount: remained frozen at £3,000 for individuals (£1,500 for most trustees) – a separate change made in earlier Budgets. See our full breakdown of the annual exempt amount for CGT in 2026/27.
- The higher rate threshold: still frozen at £50,270, continuing the fiscal drag that pushes more gains into the top rate each year.
Rate Progression at a Glance
The table below summarises every capital gains tax change 2026 taxpayers need to track, from before the Budget through to today.
| Gain Type | Before 30 Oct 2024 | 30 Oct 2024 – 5 Apr 2025 | 6 Apr 2025 – 5 Apr 2026 | From 6 Apr 2026 |
|---|---|---|---|---|
| Individuals (non-property) | 10% / 20% | 18% / 24% | 18% / 24% | 18% / 24% |
| Residential property | 18% / 24% | 18% / 24% | 18% / 24% | 18% / 24% |
| Trustees (non-property) | 20% | 24% | 24% | 24% |
| BADR / Investors’ Relief | 10% | 10% | 14% | 18% |
| Carried interest | 18% / 28% | 18% / 28% | 32% (flat) | ~34.1% (Income Tax) |
Worked Example of the Impact
A business owner sold their company for a qualifying gain of £500,000 in September 2024, before the Budget. Under the old rules, the full amount qualified for BADR at 10%, producing a tax bill of £50,000.
The same £500,000 gain realised after 6 April 2026 is taxed at the new 18% BADR rate, producing a bill of £90,000 – £40,000 more tax on an identical sale, purely as a result of timing. This is why understanding who pays 24% Capital Gains Tax and when reliefs apply has become critical to deal timing.
How to Plan Around the New Rates
Confirm Whether You Need to Act at All
Before assuming a higher rate applies, check do I need to pay Capital Gains Tax on your specific disposal – many smaller transactions remain outside the tax net entirely.
Spousal Asset Pooling
Transfers between spouses and civil partners remain on a no gain, no loss basis. Splitting ownership before a sale can still use two annual exemptions and two basic rate bands under the new rates.
Pension Contribution Planning
A gross personal pension contribution still extends your basic rate band, keeping more of a gain inside the 18% rate rather than the 24% rate – this mechanic was untouched by the October 2024 reforms.
For a full comparison of how these gains sit alongside your salary, see Capital Gains Tax vs Income Tax: what’s the difference, and if you are planning a property sale specifically, our guide on how to reduce Capital Gains Tax on property with legal planning remains fully up to date.
Why Work With a Capital Gains Tax Specialist
With rates that have moved three times in under two years, and reliefs still being phased in, generic advice quickly goes out of date. At Capital Gains Tax Experts, we track every one of the capital gains tax changes 2026 has brought as they happen, and apply the version that is actually in force on your completion date. Understanding who actually pays Capital Gains Tax in the UK under the current regime is the first step before any high-value disposal.
Frequently Asked Questions – People Also Ask
What are the current capital gains tax rates after the 2026 changes?
18% for gains within the basic rate band and 24% above it for individuals, 24% flat for trustees and personal representatives, and 18% for gains qualifying for Business Asset Disposal Relief from 6 April 2026.
Did residential property rates change in the capital gains tax changes 2026?
No. Residential property was already taxed at 18%/24% before the October 2024 Budget and remains unchanged.
When did the Business Asset Disposal Relief rate reach 18%?
From 6 April 2026. It rose from 10% to 14% on 6 April 2025, then to 18% on 6 April 2026.
How did carried interest taxation change?
It moved from an 18%/28% structure to a flat 32% from 6 April 2025, then from 6 April 2026 it was brought within the Income Tax framework, taxed as trading profits at an effective rate of around 34.1%.
Did the annual exempt amount change as part of these reforms?
No. The £3,000 individual allowance (£1,500 for most trustees) was set in earlier Budgets and was not altered by the October 2024 rate changes.
Summarising the Capital Gains Tax Changes 2026
The capital gains tax changes 2026 represent the final stage of a reform process that began on 30 October 2024: a full alignment of asset-sale tax rates with property rates, a staged increase to Business Asset Disposal Relief, and a move of carried interest out of Capital Gains Tax altogether and into the Income Tax framework.
With BADR now at 18% and no further increases currently scheduled, taxpayers finally have a stable rate to plan against – but only if they understand exactly how each change applies to their own disposal. For the official policy detail, see GOV.UK – Capital Gains Tax rates and allowances. If you are unsure which rate applies to your sale, our specialists can confirm your position before you file.
