Are exempt CGT gains added to total annual income?

jordanjim

I inherited part of a house and sold it recently, the total gain between inheriting and selling was just under £10,000 so covered by my annual capital gains allowance and no CGT to pay.

At the moment I'm a basic rate taxpayer paying by self assessment. When it comes to this year's tax, does the £10,000 get added to my usual annual earnings or ignored as it is under the CGT allowance threshold? My usual earnings + the additional £10,000 would push me into the higher tax payer bracket which would have an impact on dividends I receive as a company director.

bowlhead99

The CGT 11k limit isn't an annual allowance - it's an annual exemption.

If the gain on paper, less the exempt amount, is zero - you don't actually have any gains. Because they're exempt.

You would stick the proceeds through your tax return (if total proceeds are over 4x the annual exemption) to let HMRC know about them, but they won't affect the income tax side of things.

p00hsticks

Capital Gains and income from earnings (or savings interest or dividends) are two completely different things with two different allowances.