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How do we calculate cgt tax liability? If the gain is over 34500 then should we tax the whole amount at 20% or only the difference should be taxed at 20%?
If chargeable gain is 45000 then cgt liability would be 45000@20% or 34500@10% and the difference ie 10500@20%.My understanding is that after you’ve worked out the income tax, any remaining basic rate band is then used towards the capital gain @ 10%, then the excess is charged at 20%. Different rates for residential property that didn’t qualify for PPR relief. And remember to apply the annual tax allowance to the capital gain.
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