Capital Gains Tax Calculator

Capital gains tax (CGT) is a tax on the profit you make when you sell or dispose of an asset that has increased in value — such as shares, a second property, or a business. You are taxed on the gain (the profit), not the total amount you receive. In most systems you only pay when you realise the gain by selling, not while you simply hold the asset.

For 2025/26, UK individuals have an annual exempt amount of £3,000 — gains below this are tax-free. Above it, the rate depends on your income tax band: basic-rate taxpayers generally pay 18%, and higher/additional-rate taxpayers pay 24%. The gain is added on top of your income to determine which rate applies, so a large gain can be taxed partly at 18% and partly at 24%.

In the US, short-term capital gains (on assets held one year or less) are taxed at your ordinary income tax rate, which can be as high as 37%. Long-term capital gains (assets held more than one year) get preferential rates of 0%, 15% or 20% depending on your taxable income. Holding an asset for over a year before selling can therefore significantly reduce the tax you owe.

Usually not. In the UK, your main residence is generally covered by Private Residence Relief, so no CGT is due when you sell it. In the US, you can typically exclude up to $250,000 of gain ($500,000 for married couples filing jointly) on the sale of your primary home if you meet the ownership and use tests. Second homes and investment properties do not get this relief.

Your capital gain is the sale price minus the original purchase price (your cost basis), minus any allowable costs such as improvement expenses, legal fees or broker commissions. For example, if you bought shares for £10,000 and sold them for £16,000 with £500 of costs, your gain is £16,000 − £10,000 − £500 = £5,500. Tax is then calculated on that gain after any allowance.

Yes, legitimately. Common strategies include using your annual tax-free allowance each year, offsetting gains with capital losses, holding US assets for more than a year to qualify for lower long-term rates, transferring assets to a spouse to use both allowances, and holding investments in tax-advantaged accounts (such as an ISA in the UK or a Roth account in the US) where gains are sheltered.

You pay CGT for the tax year in which you sold the asset. In the UK, most gains are reported through Self Assessment, though UK residential property gains must be reported and paid within 60 days of completion. In the US, capital gains are reported on your annual tax return. This calculator gives an estimate — always confirm deadlines with HMRC or the IRS.