Guide

Capital Gains Tax on Shares UK 2026/27

Gains on shares and funds held outside ISAs and pensions are subject to CGT at 18% (basic rate) or 24% (higher rate) in 2026/27. This guide covers the S104 pool, the 30-day rule, the bed-and-ISA strategy and worked calculation examples.

Last updated for the 2026/27 tax year. Rates from October 2024 Autumn Budget.

CGT rates on shares 2026/27

Basic-rate taxpayer (income up to £50,270)18% Higher/additional-rate taxpayer (income over £50,270)24% Annual exempt amount£3,000 Shares inside an ISAExempt, no CGT

The rates for shares changed in October 2024 from 10%/20% to 18%/24%. Shares and residential property now use the same structure. All share disposals outside ISAs and pensions use these rates in 2026/27.

How the Section 104 pool works

When you sell shares, you cannot pick which specific lot you're selling. HMRC's Section 104 pool rule averages the cost across all acquisitions of the same share type:

  • All purchases of the same share are pooled into one holding
  • The total cost is divided by the total number of shares to get an average cost per share
  • When you sell, you use the average cost per share to calculate the gain

Example: 1,000 shares bought at £2.00 (cost £2,000) plus 500 shares bought later at £4.00 (cost £2,000). Pool: 1,500 shares, total cost £4,000, average cost £2.67/share. Sell 600 shares at £5.00 (proceeds £3,000). Gain = £3,000 − (600 × £2.67) = £3,000 − £1,600 = £1,400.

After the £3,000 AEA, if your total gains for the year are below £3,000, no CGT is due. If the taxable gain is positive, apply the relevant rate.

The 30-day matching rule (bed and breakfast)

Before using the S104 pool, HMRC applies priority matching rules:

  1. Same-day rule, shares bought on the same day as the sale are matched first
  2. 30-day rule, shares bought within 30 days after the sale are matched next (the "bed and breakfast" rule)
  3. S104 pool, all remaining shares use the pool average cost

The 30-day rule stops you selling shares to crystallise a loss (or use your AEA) and immediately buying back. If you sell on 15 March and rebuy the same shares on 1 April (within 30 days), the rebuy is matched against the sale. The pool cost is not used.

To avoid the rule: wait 31 days before repurchasing, buy back inside an ISA (the 30-day rule does not apply to ISA repurchases), or switch to a similar but different fund in the meantime.

Worked example: shares CGT calculation

David earns a salary of £45,000. He sells 1,000 shares in a fund for £18,000. His average pool cost was £10,000.

Sale proceeds£18,000 Pool cost (1,000 shares × average cost)−£10,000 Gross gain£8,000 Annual exempt amount−£3,000 Taxable gain£5,000

David's taxable income = £45,000 − £12,570 = £32,430. Remaining basic-rate band = £37,700 − £32,430 = £5,270. The £5,000 gain is below £5,270, so all of it falls within the basic-rate band.

£5,000 at 18% (all within basic-rate band)£900

If David earned £55,000 instead (higher-rate band), the same £5,000 gain would be taxed at 24% = £1,200.

Bed-and-ISA strategy

The bed-and-ISA strategy moves holdings from a taxable general investment account (GIA) into an ISA, where all future growth is permanently CGT-free.

  1. Sell shares or funds in your GIA, this crystallises the gain (using your AEA to shelter up to £3,000)
  2. Immediately repurchase the same investments inside a Stocks and Shares ISA
  3. Future growth is now inside the ISA, entirely CGT-free forever

The repurchase inside the ISA can happen the same day. The 30-day rule does not apply to ISA repurchases — HMRC confirmed this at CG42562. The ISA holding is legally distinct, so a same-day GIA sale and ISA rebuy fully crystallises the gain.

Time the bed-and-ISA so gains fall within your AEA (£3,000). A couple with £6,000 of combined unrealised gains can move £6,000 of value into ISAs with zero CGT.

ISA exemption, zero CGT on gains inside an ISA

Any shares, funds or ETFs held inside a Stocks and Shares ISA are completely exempt from CGT. There is no ceiling on gains — a £500,000 profit inside an ISA is entirely tax-free. The annual subscription limit is £20,000 per person for 2026/27.

Put your highest-growth assets inside the ISA wrapper. Over a lifetime that is where the real CGT saving comes from.

Calculate your shares CGT

Enter your share sale details and income into our shares CGT calculator for an instant 2026/27 estimate.

Shares CGT Calculator

Frequently asked questions

What is the CGT rate on shares in 2026/27?

18% for gains within the basic-rate band (income up to £50,270) and 24% for gains above it. These rates replaced the previous 10%/20% rates in October 2024.

How do share matching rules work?

Disposals are matched first against same-day purchases, then against purchases within 30 days (bed-and-breakfast rule), then against the S104 pool average. This prevents selective lot picking and rapid buy-sell cycling to avoid tax.

Do shares inside an ISA have CGT?

No. Shares, funds and ETFs inside a Stocks and Shares ISA are entirely exempt from CGT, regardless of how large the gains become.

Can I sell shares to crystallise a loss and immediately rebuy?

Not in the same account, the 30-day rule would match the repurchase against the sale, neutralising the loss. To genuinely crystallise a loss: wait 31+ days to repurchase; buy back inside an ISA; or switch to a similar but different fund.

Do I need to report share disposals to HMRC?

Yes, through Self Assessment if your total disposals exceeded four times the AEA (£12,000 for 2026/27), or if CGT is owed. Unlike property, there is no 60-day reporting rule for shares, the deadline is 31 January following the end of the tax year.

This page is for general information only and is not financial or tax advice. Consult a qualified tax adviser for guidance on your specific situation.