Take pains from gains

MOST people don't give capital gains tax (CGT) much thought until they suddenly get hit by a bill when selling something.

- By Harvey Jones

CGT is often called the forgotten tax, yet Britons paid more than £14.5billion last year, once sole traders and business partners are included. That's almost double the inheritance tax take, but attracts far less attention.

With the CGT allowance slashed and rates hiked, many investors, property owners and even casual sellers now risk unexpected bills, said Sarah Coles, head of personal finance at Hargreaves Lansdown. “CGT is far less well-known than its tax siblings, but it packs some serious clout.”

Coles lists seven surprising ways you might now trigger an unexpected CGT bill, and how to fight back.

Falling allowances

The CGT annual exempt amount has been slashed from £12,300 to just £3,000. “More people than ever are being hit with CGT for the first time, often without realising until it's too late.”

Higher tax rate