Prior to the Budget, there was speculation that there would be significant changes to capital gains tax and inheritance tax.
Capital Gains Tax
The value of gains that a taxpayer can realise before paying capital gains tax, the annual exemption, will be maintained at the present level until April 2026. It will remain at £12,300 for individuals, personal representatives and some types of trusts and £6,150 for most trusts.
The inheritance tax nil rate bands will remain at existing levels until April 2026. The nil rate band will continue at £325,000, the residence nil rate band will continue at £175,000, and the residence nil rate band taper will continue to start at £2 million.
Qualifying estates can continue to pass on up to £500,000 and the qualifying estate of a surviving spouse or civil partner can continue to pass on up to £1 million without an inheritance tax liability.
No other announcement were made regarding capital gains tax and inheritance tax.
This will be met with plenty of relief by advisers and taxpayers. This means that the existing exemptions and reliefs continue to be available for our tax planning strategies.