The capital gains tax (CGT) annual exempt amount will increase to £10,600 for 2011/12 for individuals, personal representatives of deceased persons and trustees of certain settlements for the disabled. The annual exempt amount for most other trustees is £5,300.
The CGT threshold will in future increase with CPI rather than RPI.
For capital gains above the annual exempt amount the CGT rate for basic and higher rate tax payers will remain at 18 and 28 per cent respectively.
Gains made in respect of certain business assets may qualify for entrepreneurs’ relief.
The amount of an individual’s gains that can qualify for entrepreneurs’ relief was subject to a lifetime limit of £5 million before the Budget. This limit will be increased to £10 million for gains arising on or after 6 April 2011.
Gains qualifying for the relief will continue to be taxed at a 10% rate.