Guide
Capital Gains Tax for Higher-Rate Taxpayers 2026/27
If your taxable income already exceeds the basic-rate limit of £50,270, there is no remaining basic-rate band to absorb any capital gains. Every pound of gain above the £3,000 annual exempt amount is taxed at the 24% higher rate. This guide explains how the rates work for higher earners and the planning options available.
Published by the UK Money Calculators editorial team. Last updated for the 2026/27 tax year.
CGT rates for higher-rate taxpayers in 2026/27
Capital gains tax sits on top of your income for rate-band purposes. If your taxable income (after personal allowance) already fills the basic-rate band, your gains have no basic-rate band to fall into:
- Residential property gains (second homes, buy-to-let, inherited property): 24%
- Other assets (shares, crypto, business assets): 24%
Both residential and non-residential gains are now taxed at the same higher rate of 24% for higher-rate taxpayers — the distinction between the two asset types only affects the rate for basic-rate taxpayers (18% vs 18% — both 18% in the basic-rate band for 2026/27).
How gains are stacked on top of income
HMRC calculates CGT by placing capital gains on top of your taxable income. The process is:
- Calculate your taxable income (gross income minus personal allowance of £12,570)
- Identify how much basic-rate band is unused (basic-rate limit £50,270 minus taxable income)
- Apply the annual exempt amount (£3,000) to reduce the gain
- The first slice of the taxable gain fills any remaining basic-rate band at 18%; the rest is taxed at 24%
If your taxable income is £50,270 or above, step 2 produces zero or a negative number — there is nothing remaining in the basic-rate band, so the entire taxable gain is at 24%.
Worked example
Rachel has a salary of £68,000 in 2026/27. She sells a buy-to-let property, making a gain of £30,000. She has no capital losses to offset.
Taxable income (salary minus personal allowance)£55,430
Basic-rate band remaining (£50,270 − £55,430)£0
Property gain£30,000
Minus annual exempt amount−£3,000
Taxable gain£27,000
CGT at 24% (all at higher rate)£6,480
Rachel owes £6,480 CGT. Because this is a residential property, she must also report and pay within 60 days of the completion date.
Can pension contributions help?
Making additional pension contributions before the end of the tax year can reduce your taxable income. If a pension contribution brings your taxable income below £50,270, some of the capital gain may fall into the basic-rate band and be taxed at 18% rather than 24%. This is the most commonly cited CGT-planning strategy for higher earners.
Example: If your income is £52,000 and you make a pension contribution of £5,000 (grossed up to £6,250 with basic-rate relief added), your taxable income falls to approximately £45,750 — leaving £4,520 of basic-rate band available for gains.
However, there are limits on pension contributions: the annual allowance is typically £60,000 (or 100% of earnings, whichever is lower). Take advice to ensure any contribution is within your allowance.
Other planning considerations
- Use your spouse's allowances — transfers to a spouse/civil partner before sale are no-gain/no-loss, allowing both annual exempt amounts and potentially both rate bands to be used
- Spread disposals across tax years — selling in different tax years uses two annual exempt amounts (£3,000 each year) and can stagger the income impact
- Offset capital losses — losses from previous years can reduce the taxable gain
- ISA transfers — shares held within an ISA are CGT-free; shares outside an ISA can be transferred in using a Bed & ISA transaction (though this crystallises any gain at the point of sale)
Calculate your CGT as a higher-rate taxpayer
Enter your income and gain in our calculator to see exactly how much CGT is due at 2026/27 rates.
Open the CGT calculator
Official sources
Frequently asked questions
What CGT rate do I pay as a higher-rate taxpayer?
If your taxable income exceeds £50,270 — the higher-rate threshold — your entire taxable capital gain (above the £3,000 annual exempt amount) is charged at 24%. This applies to both residential property gains and gains on other assets such as shares and crypto.
Can I reduce my income to access the 18% lower rate?
Yes. Pension contributions reduce your taxable income, which can open up basic-rate band for your capital gains. Gift Aid donations also extend the basic-rate band. If you can bring your taxable income below £50,270 before adding the gain, the portion of the gain that falls below £50,270 is taxed at 18% rather than 24%.
What counts as income for CGT rate purposes?
Taxable income for CGT band purposes includes employment income, self-employment profits, pension income, rental income, savings interest above the personal savings allowance, and dividend income above the £500 dividend allowance. The personal allowance (£12,570) is deducted first. Capital gains themselves are not counted as income — they are added on top after income has filled the bands.
Does making a large capital gain push my income into a higher tax bracket?
No. Capital gains are not classified as income and do not affect your income tax rate. However, if your income is between £100,000 and £125,140, the personal allowance is tapered — and capital gains do count towards the "adjusted net income" threshold for this taper. This can create an effective marginal rate situation on income, so take advice if your income is in that range.
This page is for general information only and is not financial, tax or legal advice. Your individual circumstances will affect your CGT position. Consult a qualified tax adviser before making disposal or planning decisions.