This is coming at an interesting time: Rishi Sunak has called for a review of capital gains tax. The review will consider Capital Gains Tax and the taxation of chargeable gains in relation to individuals and smaller businesses and develop recommendations for simplification including reducing distortions from both an administrative and technical standpoint.
This will include consideration of general areas such as:
- the overall scope of the tax and the various rates which can apply
- the reliefs, exemptions and allowances which can apply, and the treatment of losses
- the annual exempt amount and its interactions with other reliefs
- the position of individuals, partnerships and estates in administration
- the position of unincorporated businesses and stand-alone owner-managed trading or
- investment companies, including the setting up, selling or winding up of such businesses or
- companies
- any distortions to taxpayers’ personal or business investment decisions
- interactions with other parts of the tax system such as Income Tax, Capital Allowances,
- Stamp Taxes and Inheritance Tax, including potentially different definitions for similar
- transactions/events.
This is an area that has changed many times over the years, and it almost feels that each Chancellor wants to carve his or her own identity into the capital gains tax system. Let’s wait to see whether Rishi Sunak can make capital gains tax sit alongside all other taxes comfortably, most especially income tax. We wait with bated breath.
Details are available here