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Business
Capital Gains Tax
Tax paid on the profit made when selling an asset that has increased in value.
Capital gains tax applies to the sale of property, shares, goodwill, and other assets. Businesses can claim reliefs such as rollover relief or business asset disposal relief to reduce the bill. Proper planning is essential when selling assets.
It's the tax you pay on the profit when you sell something for more than you bought it for.
Real world: A business sells a warehouse it bought for £400,000 for £650,000. The £250,000 profit is subject to capital gains tax (after any reliefs or allowances). Individuals and companies have different rates and rules.
💡 Capital gains tax is the price of success when you sell something that has gone up in value.