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ACCA Strategic Professional · Advanced Taxation (UK) · Capital gains tax: gains and losses on the disposal of movable and immovable property

For an individual disposing of a chargeable asset such as a painting in the 2025/26 tax year, which statement about the capital gains tax annual exempt amount and rates, as set out in the ATX-UK tax rates and allowances, is correct?

The annual exempt amount is £3,000 and gains are taxed at 18% where they fall within the unused basic rate band and at 24% above it. The rate depends on the individual's taxable income, and unused exemption cannot be carried forward.

  1. AThe annual exempt amount is £3,000 and gains are taxed at 18% or 24% depending on the individual's taxable incomeCorrect
  2. BThe annual exempt amount is £3,000 and all gains on non-residential assets are taxed at 24%
  3. CThe annual exempt amount is £12,300 and gains are taxed at 10% or 20%
  4. DThe annual exempt amount is £3,000 and unused amounts can be carried forward for up to three years

Explanation

The tax rates table gives an annual exempt amount of £3,000 and rates of 18% (lower) and 24% (higher). The rate depends on how much of the basic rate band is available after taxable income. Fixing 24% for all gains ignores the 18% lower rate, and the £12,300 and 10%/20% figures are old rates. Unused annual exempt amounts cannot be carried forward.

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