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Exemption
Capital gains tax is one of the most complicated taxes for individuals to understand. It is applicable to many assets and investments but most commonly known to be payable on the disposal of investment property and shares. What makes this tax difficult to digest is the different tax rates associated with different disposals as well as the various tax reliefs available, such as the capital gains exemption allowance. The annual exemption for capital gains is available to an individual in each and every tax year. What this means is even if you have used up your allowance in one tax year, it is reset from the start of the next tax year. Currently the allowance stands at £11,100 and is to be offset against any chargeable gain that has been derived from a relevant disposal.
 
Since 6th April 2016 the changes to capital gains tax has made this topic an increasingly complicated area for taxpayers to understand and implement correctly. Penalties for filing errors are as severe as ever before, and so it is imperative that individuals seek professional advice in advance of any relevant disposal to avoid any adverse consequences.
 
At James, Stanley & Co not only do we have experts who fully understand the vast rules that encompass capital gains tax, but in addition we help clients structure their investment and asset portfolios by advising in two key ways; firstly we devise a disposal strategy that enables clients to make optimal use of the capital gains annual exemption, and secondly upon disposal we ensure clients claim on all available costs and expenditure to minimise the chargeable gain. 
 
Examples of how we help property investors on disposal, is by reclaiming all “enhancement expenditure” on properties (such as building extensions) as well as including all allowable incidental costs on purchase and disposal (including professional fees and stamp duty land tax). Combine this with implementing a staged disposal strategy making use of the capital gains annual exemption saves clients literally tens of thousands of pounds in tax.
 
Examples how we help business owners on the sale of their respective businesses is by agreeing a special 10% capital gains tax rate with H M Revenue & Customs by way of Entrepeneurs’ Relief. When comparing this with the usual capital gains tax rates, this again saves clients thousands of pounds in tax, but requires detailed knowledge and understanding of H M Revenue & Customs criteria.
 
For any individuals with multiple assets and investments we strongly recommend you get in touch so that we in turn can devise your disposal strategy so that you pay the legal minimum amount of tax possible.