CG38785 - The charge to Capital Gains Tax
Any TCGA92/S87 gain is added to the beneficiary’s other chargeable gains and charged at their appropriate rate of Capital Gains Tax.
Losses
TCGA92/S2(4) or S1E(4) from 6 April 2019 to 5 April 2025
A taxpayer’s personal losses cannot be set against any s87 gains that accrued to them prior to 6 April 2025. Before that date any personal losses could only be set against their other gains and the balance carried forward.
TCGA92/S1E(4) was repealed with effect for the tax year 2025/26 and subsequent tax years. From that year onwards this allows personal losses to be used against gains treated as accruing to an individual under s87, s87HA (capital payments routed via non-residents or qualifying new residents) and s89(2) (migrant settlements)
Annual exempt amount
There are no restrictions on the use of the beneficiary’s annual exempt amount. It may be to the taxpayer’s advantage to have this set against any s87 gains first to minimise any increase in the rate of tax, CG38795.
Annual exempt amount: non-domiciled beneficiary (for tax years before 2025/26)
See CG38805 for the effect on the annual exempt amount if a non-domiciled beneficiary claims the remittance basis in relation to tax year 2024/25 or an earlier tax year.
Capital Gains Tax Rates
See CG10245.