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A freeze on the annual exemption amount to 2026!

Legislation will be introduced in the Finance Bill 2021 to maintain the annual exempt amount at its current level of £12,300 for individuals and personal representatives and £6,150 for most trustees of settlements for the tax years 2021 to 2022 up to and including 2025 to 2026.

The rules for the annual exempt amount are at sections 1K and 1L, and Schedule 1C to, the Taxation of Chargeable Gains Act (TCGA) 1992.

Section 1L provides that the annual exempt amount, which is currently set at £12,300, is increased annually in line with increases in the Consumer Prices Index (CPI), rounded up to the nearest £100.

Schedule 1C provides that the annual exempt amount available to most trustees of settlements is one half of the amount available to individuals.

Legislation will be introduced in Finance Bill 2021 to maintain the annual exempt amount at its present levels for tax years 2021 to 2022, 2022 to 2023, 2023 to 2024, 2024 to 2025 and 2025 to 2026.

This article has been shared from ACCA In Practice, to whom copyright belongs.  Whitefield Tax are an ACCA Member Firm