RK INVESTING
Capital Gains Tax is one of the biggest drains on property profits, and recent changes to allowances and rates mean that even modest sales can generate significant tax bills. A proactive CGT strategy is now a core part of any serious investment plan.
1. Understanding Current CGT Rates and Allowances
Residential property gains are taxed at rates that now sit well above historical levels for many investors, while the annual exemption has been sharply reduced. This means timing and allowance management matter more than ever.
Tip: Check the latest rates and allowances at the start of each tax year and model the impact of potential sales under different scenarios.
2. Spreading Gains and Using Couples Efficiently
For jointly owned property and married couples, careful ownership planning can double the effective use of annual exemptions and potentially reduce overall CGT. Adjusting ownership well before a sale is often more effective than reacting later.
Tip: Review legal ownership structures regularly, especially when adding or removing partners or family members from the title.
3. Reliefs, Rollover and Planning for Development Projects
Developers and active investors may still benefit from reliefs when reinvesting in qualifying assets or when moving between properties. Understanding which reliefs apply, and the strict conditions, can create powerful deferral and savings opportunities.
Tip: Document your intention and timing clearly when reinvesting proceeds; HMRC often looks for evidence that a relief was planned in advance.
Conclusion
CGT planning is not just about the moment of sale; it’s about building a portfolio and exit roadmap that minimises tax across your entire investing journey. The most successful investors plan disposals years in advance.
RK Investing supports investors in creating tax-efficient disposal and reinvestment strategies tailored to their goals for 2026 and beyond.