Property Capital Gains Tax Calculator 2026/27

Calculation runs based on standard HMRC rules.

Deductions are calculated and adjusted accordingly.

Frequently Asked Questions & Detailed Tax Guide

How does Capital Gains Tax (CGT) work on UK property sales?

Capital Gains Tax (CGT) is payable when you sell or dispose of a property that has increased in value. Unlike standard assets, residential property gains are subject to higher CGT rates and stricter reporting deadlines in the UK. For the 2026/27 tax year, the Annual Exempt Amount (the tax-free allowance for capital gains) is set at £3,000 per individual. Any gain above this allowance must be reported and paid to HMRC within 60 days of the completion date. Private Residence Relief (PRR) applies if the property was your only or main home throughout your entire period of ownership, exempting you from CGT entirely. However, if the property was rented out, used for business, or is a second home, CGT applies proportionally.

What are the CGT rates for residential property in 2026/27?

The CGT rates on residential property disposals depend on your total taxable income:

• Basic Rate Taxpayers: 18% CGT on the portion of the gain that, when added to your taxable income, falls below the basic rate threshold (£50,270).
• Higher/Additional Rate Taxpayers: 24% CGT on any portion of the gain that falls above the basic rate threshold.

Note: Non-residential property (commercial land, shops, etc.) is taxed at different rates (10% basic, 20% higher rate), but residential property remains at 18% and 24% respectively.

Step-by-Step CGT Calculation: Worked Example

Let’s calculate the CGT for an individual higher-rate taxpayer selling a buy-to-let property in the 2026/27 tax year:

• 1. Purchase Price (2018): £200,000
• 2. Sale Price (2026): £280,000
• 3. Deductible Acquisition & Disposal Costs (Stamp duty, solicitor fees, estate agent fees): £10,000
• 4. Deductible Capital Improvements (Double glazing extension, structural works): £15,000
• 5. Net Capital Gain: £280,000 – £200,000 – £10,000 – £15,000 = £55,000
• 6. Deduct CGT annual exemption: £55,000 – £3,000 = £52,000 taxable gain.
• 7. Calculate tax at 24% (Higher Rate): £52,000 * 24% = £12,480 CGT payable.

Tax Expert Pro-Tips: How to Reduce Your CGT Bill

David Vance, CTA FCA, recommends: “There are several legal ways to mitigate property CGT. First, if you are married or in a civil partnership, you can transfer a portion of the property’s ownership to your spouse before the sale using a tax-free transfer. This allows you to utilize two annual exempt allowances (£6,000 total) and potentially access the lower 18% basic tax rate if your spouse earns less. Second, keep meticulous records of all capital improvements. Routine maintenance (like painting or boiler repairs) is deductible against rental income, but structural enhancements (like extensions or brand new layout changes) are offset against CGT.”

Legislative References

• Taxation of Chargeable Gains Act 1992 (TCGA92) – Section 222 (Private Residence Relief rules).
• Finance Act 2020 – 60-day reporting and payment rules for UK residents.
• HMRC Capital Gains Manual (CG64200) – Deductible expenditure and improvements definitions.