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Why Gifting an Asset Can Still Trigger CGT
Selling something below market value or giving it away outright doesn't avoid Capital Gains Tax — for CGT purposes, HMRC treats most gifts as a disposal at the asset's full market value on the date of the gift, not whatever (if anything) actually changed hands. The exception is a gift to your spouse or civil partner, or to a UK-registered charity, which is treated as a no-gain/no-loss transfer with no CGT due.
Gift Hold-Over Relief
For certain gifts — mainly business assets, agricultural property, or gifts into (or out of) most trusts — you and the recipient can jointly elect for Gift Hold-Over Relief. This doesn't cancel the gain; it defers it by reducing the recipient's acquisition cost by the amount of the held-over gain, so the CGT is effectively paid later, when the recipient eventually disposes of the asset. It does not apply to a straightforward gift of a family home or investment property to a child — that gain is chargeable immediately.
Gifting the family home
Gifting your only or main residence to a child while you still live in it (without paying a market rent) can also trigger the "gift with reservation of benefit" Inheritance Tax rules on top of any CGT — the two taxes are separate and both need checking.
How this calculator works — Formulas & Method
Source: gov.uk/capital-gains-tax/gifts, gov.uk/hold-over-relief-gifts-hmrc · Deterministic calculation — no AI, no arbitrary estimation
Constants used
| Constant | Value | Source |
|---|---|---|
| Annual exempt amount | £3,000 | gov.uk/capital-gains-tax/rates, 2026/27 |
| Basic rate band upper limit | £50,270 taxable income | gov.uk Income Tax rates 2026/27 |
| CGT basic / higher rate | 18% / 24% | gov.uk/capital-gains-tax/rates |
| Disposal value used | Market value at gift date | gov.uk/capital-gains-tax/gifts |
Formulas
gain = market_value_at_gift_date − original_acquisition_cost
taxable_gain = max(0, gain − £3,000)
cgt_now = taxable_gain taxed at 18%/24% per remaining basic band
— With Hold-Over Relief —
cgt_now = £0
recipient_base_cost = market_value_at_gift_date − held_over_gain
Assumes the gift qualifies for Hold-Over Relief where claimed — eligibility is restricted to business/agricultural assets and certain trust transfers; always confirm your own position with HMRC or a qualified adviser.
Get It Filed Correctly, Not Just Estimated
This calculator gives an estimate — actually reporting and paying it correctly is a separate step with its own deadline and paperwork.
- Gifting an asset (not selling it): HMRC treats most gifts to anyone other than a spouse/civil partner as a disposal at market value, whether or not money changes hands — get the market-value figure and any Hold-Over Relief claim confirmed before you gift, not after.
- Multiple disposals in one tax year: ordering and timing disposals across the 5/6 April boundary can materially change what you owe.
- Inherited or gifted assets: your acquisition cost for CGT purposes isn't always what you think — get the base cost confirmed.
- Business Asset Disposal Relief: can cut your rate to 18% on qualifying gains, but eligibility rules are strict.
A fixed-fee online accountant can handle the return and your wider Self Assessment together.
Compare Online Accountants →Transparency & Methodology
Methodology & Sources
Figures are public HMRC rates. For your exact position, use gov.uk/capital-gains-tax.
Not Tax or Legal Advice
Information only. Consult the Chartered Institute of Taxation or an adviser via the FCA Register.
Open Source
Formulas are public. Inspect on GitHub.