CGT Rate Increases 2025/26: What Business Owners Need to Know Now
Capital Gains Tax Just Got More Expensive
If you're a business owner, property investor, or planning to sell assets in 2025/26, the Capital Gains Tax changes announced in the November Budget will have a direct impact on your bottom line. The rates have increased significantly, and the reliefs available are becoming more restrictive.
The Key Changes at a Glance
The Chancellor has increased CGT rates across the board since taking office:
💷 Higher rate CGT: Risen from 20% to 24% on most asset disposals
💷 Basic rate CGT: Now 18% (previously 10%)
💷 Annual exemption: Down to just £3,000 (it was £12,300 not long ago)
What Does This Mean in Real Terms?
Let's put this into perspective. For a business owner selling a commercial property with a £200,000 gain, the 4% rate increase means an additional £8,000 in tax compared to the previous rates. These aren't small adjustments—they represent real money that could stay in your business or retirement fund with proper planning.
Business Asset Disposal Relief - Still Available But Changing
Business Asset Disposal Relief (formerly known as Entrepreneurs' Relief) is still on the table, offering reduced CGT rates on qualifying business disposals up to the £1 million lifetime limit. However:
- The rate is 14% for the 25/26 tax year
- It rises to 18% for the 26/27 tax year
The rules are complex and HMRC scrutiny is increasing. Many business owners assume they automatically qualify, only to discover issues after the sale.
Employee Ownership Trusts - New Restrictions
If you're considering selling your business to an Employee Ownership Trust, be aware that the Budget introduced significant restrictions. The CGT relief has been reduced from 100% to 50% as of 26 November 2025.
This makes early consultation essential—ideally 12-18 months before any planned sale.
The Critical Timing Factor
Here's what many people get wrong: they contact tax advisors weeks before completion. But effective CGT planning takes 6-12 months of advance work—restructuring ownership, meeting qualifying conditions for reliefs, and documenting crucial elections.
Last-minute advice can only do so much. Strategic planning requires time.
Don't Wait Until It's Too Late
If you're planning to sell business assets, investment properties, or considering your exit strategy in the next 12-24 months, now is the time to review your position. The rate increases mean that decisions made today could save substantial amounts.
How TAG Accountants Can Help
At TAG Accountants Group, we specialize in helping clients navigate complex tax changes and implement strategies that preserve wealth legally and effectively. Our approach includes:
✅ Strategic Planning Reviews - Analyzing your position and identifying opportunities
✅ Business Exit Planning - Comprehensive tax planning that coordinates CGT, IHT, and income tax considerations
✅ Ongoing Compliance and Monitoring - Keeping you informed as tax rules change
✅ Peace of Mind - Professional advice that stands up to HMRC scrutiny
Read the Full Guide
Want to dive deeper into the CGT changes, Business Asset Disposal Relief, IHT interactions, and legitimate planning opportunities?
The full article includes:
- Detailed breakdown of all rate changes
- Business Asset Disposal Relief qualifying conditions
- IHT and CGT interaction strategies
- Comprehensive FAQ section
- Practical planning opportunities
Get in Touch
Don't leave tens of thousands of pounds on the table through rushed decisions or missed opportunities. Professional tax advice isn't just valuable—it's essential.
📞 Call us: 01902 783172
🔗 Visit: www.tag-agl.com
✉️ Or contact us through our online enquiry form
We'd be pleased to discuss your specific circumstances and explore how strategic tax planning can help you navigate these CGT changes effectively.
This article is for general information purposes only and does not constitute specific advice for your individual circumstances. Capital Gains Tax planning should be tailored to your personal situation with qualified professional advisors.
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