Capital Gains Tax explained: What you pay it on, rates and allowances for 2022 | Personal Finance | Finance

To make matters complicated not everyone will pay the same amount of Capital Gains Tax (CGT). Exactly how much CGT one pays depends on how much they earn and pay in income tax.

Although the threshold has stayed the same for 2022, more people could be caught in the net as house prices continue to rise.

This will undoubtedly push more people over the threshold.

In the year 2019 to 2020 HM Revenue and Customs (HMRC) raised £9.8billion, a figure that is expected to rise even more.

However, there are 10 perfectly legal ways Britons can pay less CGT.

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By far one of the easiest ways to reduce how much CGT one pays is by transferring assets to a spouse and making the most of both allowances.

If Britons can’t avoid paying capital gains they can work out how much they need to pay by working out their gain or loss when they dispose of an asset.

HMRC has more information on its website where people can use the calculator to work out exactly how much they need to pay.

It’s a good idea to seek independent financial advice if people are still unsure.