How much is the Capital Gains Tax on property in 2026/27?

The Finance Act 2025 significantly overhauled the Capital Gains Tax (CGT) landscape, most notably by harmonising the tax rates applied to residential property and other capital assets. If your clients are disposing of property in the 2026/27 tax year, you must navigate updated main rates, adjusted business reliefs, and strict reporting deadlines.

This guide sets out exactly how much Capital Gains Tax applies to property disposals in 2026/27, detailing the core rates, exemptions, and crucial compliance rules.

The Main CGT Rates for Property (2026/27)

Historically, residential property disposals attracted a surcharge compared to other asset classes. However, legislation introduced in the Finance Act 2025 eliminated this discrepancy for disposals made on or after 30 October 2024.

For the 2026/27 tax year, the Taxation of Chargeable Gains Act 1992 (TCGA 1992) applies the following main rates to property gains:

1. Individuals

The rate an individual pays depends entirely on their available income tax basic rate band.

• Basic Rate Gains (18%): Individuals pay 18% on property gains that fall within their unused basic rate band.
• Higher Rate Gains (24%): Individuals pay 24% on any property gains that exceed the basic rate band.

HMRC’s Capital Gains Manual confirms this harmonised treatment:

For the 2026/27 tax year, the main rates of Capital Gains Tax (CGT) for individuals are 18% (for gains within the basic rate band) and 24% (for gains exceeding the basic rate band).

2. Trustees and Personal Representatives

Trustees of a settlement and personal representatives of a deceased individual do not benefit from a tiered rate structure. They pay a flat rate of 24% on all chargeable property gains.

The Annual Exempt Amount (AEA)

Before applying the 18% or 24% tax rates, taxpayers deduct their Annual Exempt Amount (AEA) to arrive at their net taxable gain. Under section 1K of TCGA 1992, the government has fixed the AEA for individuals at a historically low level for the 2026/27 tax year.

“The annual exempt amount for a tax year is £3,000.”

You deduct this £3,000 allowance after offsetting any allowable in-year losses, but before deducting brought-forward losses.  For most trustees, the AEA is restricted to half of the individual amount, effectively providing them with a £1,500 exemption.

Property Exemptions and Reliefs

When calculating the final CGT liability, you must account for reliefs that either fully exempt the property or reduce the applicable tax rate.

Private Residence Relief (PRR)

Private Residence Relief continues to provide a full exemption from CGT on the disposal of an individual’s main residence.  If a property qualifies as the taxpayer’s primary, lived-in home for the entire period of ownership, no CGT applies, and the disposal consumes none of the taxpayer’s AEA.

Business Asset Disposal Relief (BADR)

If the property qualifies as a business asset (for example, a qualifying commercial property used in a trade), the taxpayer may claim Business Asset Disposal Relief. Section 8 of the Finance Act 2025 increases the BADR tax rate for the 2026/27 tax year.  For qualifying disposals made on or after 6 April 2026, the BADR rate is 18%.

Investors’ Relief (IR)

Where a taxpayer disposes of qualifying shares in an unlisted trading company (which may hold property as part of its trade), Investors’ Relief provides a dedicated lower CGT rate. Like BADR, section 9 of the Finance Act 2025 increases the Investors’ Relief rate to 18% for disposals made on or after 6 April 2026.

Additionally, practitioners must note a severe restriction to the relief’s availability: the government permanently reduced the Investors’ Relief lifetime limit from £10 million to £1 million.

Compliance: The 60-Day Reporting Deadline

A critical procedural hurdle exists for residential property. Where PRR does not fully exempt a residential property disposal (such as the sale of a buy-to-let investment or a holiday home), the taxpayer cannot wait until their annual Self Assessment tax return to declare the gain.

The ’60-day rule’ applies to these transactions.  The taxpayer must calculate the gain, submit a UK property return, and pay the estimated CGT liability within 60 days of the transaction completing.

Summary Table: 2026/27 Property CGT Elements

For completeness, consider reviewing the client’s current income levels to determine exactly how much basic rate band remains available for the property gain, and ensure the client sets aside funds immediately to meet the strict 60-day payment window for residential disposals.