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ACCA Strategic Professional · Advanced Taxation (UK) · Capital gains tax: gains and losses on the disposal of shares and securities

Dev sold his 100% holding in Delta Ltd, an unquoted trading company, in May 2026 and makes no other disposals in 2026/27. He has owned the shares and been a director for five years. His chargeable gain is £1,150,000 and he has made no earlier business asset disposal relief claims. Taking the lifetime limit and rate from the ACCA tables, and assuming his taxable income uses up the basic rate band and the annual exempt amount is ignored for simplicity, what is the CGT payable?

The CGT is £176,000. The first £1,000,000 of the gain attracts business asset disposal relief at 14%, giving £140,000, and the remaining £150,000 is taxed at the 24% higher rate, giving £36,000. The lifetime limit stops the 14% rate applying to the whole gain.

  1. A£140,000 + £36,000 = £176,000Correct
  2. B£1,150,000 x 24% = £276,000
  3. C£1,000,000 x 14% = £140,000 only
  4. D£1,150,000 x 14% = £161,000

Explanation

The first £1,000,000 of gain qualifies for business asset disposal relief at 14% = £140,000. The excess £150,000 is taxed at the higher rate of 24% = £36,000. The total is £176,000. Applying 14% to the whole gain ignores the lifetime limit.

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