2009/10

2008/09

Annual exemption

- Individuals

£9,600

- Personal representatives

£5,500

£4,800

- Trusts for mentally disabled

£5,500

£4,800

- Other trusts

£5,500

£4,800

Chattels exemption

£6,000

£6,000

Rates

- Individuals, trustees and personal representatives

18%

18%

- Entrepreneurs' relief (life-time net gains up to £1m)

5/9ths

5/9ths

CAPITAL GAINS TAX RATE

From 6 April 2008 net gains are taxed at 18% irrespecive of the length of ownership of he asset. In addition, there is no distinction between business and non-business assets. Other income or personal allowances are disregarded.

TAPER RELIEF AND INDEXATION ALLOWANCE

Net gains realised before 6 April 2008 are treated as the top slice of taxable income. Gains are calculated after indexation allowance (for assets held prior to April 1998) and are subject to taper relief (with differing rates for business and non-business assets. From 6 April 2008, taper relief and indexation allowance are abolished.

From 6 April 2008 the first £1,000,000 of lifetime gains on the disposal of certain assets (unincorporated trading businesses and shares in trading companies where 5% or more is held) will be reduced to 5/9ths of the full gain, making the effective Capital Gains Tax rate on some gains 10%.