One of the few advantages of being married or in a Civil Partnership is that transfers between spouses and civil partners are exempt from capital gains tax. Each party also has their own capital gains tax annual exemption (currently £12,000 each), meaning that each can have a capital gain of up to £12,000 without having to pay any capital gains tax.
If you own an asset in your own name you can take advantage of this by transferring a share of it to your spouse or civil partner before sale. The transfer is tax free and the first £24,000 of any gain on disposal will then be free of capital gains tax, instead of just the first £12,000. The rate at which you pay capital gains tax is linked to the level of your income. If your spouse or civil partner pays income tax at a lower rate than you (or vice versa) then further savings can be made.
If you are married or in a Civil Partnership and you are thinking of selling an asset you may want to consider transferring it into joint names first, but be aware that there may be costs associated with doing so.
Should you have any questions with regards to any of the above please contact your local Haines Watts office and speak to a tax specialist.
Want to know more? Call us on 01392 260310 or email firstname.lastname@example.org