Budget 2016: what you need to know about reduction in capital gains tax rates

Gill Tallon, partner and private client specialist at Mercer & Hole, examines the impact of the surprise reduction in capital gains tax (CGT) rates in Budget 2016, considering options for investors to review their tax liability, plus the impact on distributions from offshore trusts

It has long been speculated that the rate of capital gains tax (CGT) might rise to close the gap between the rates of income tax and CGT. In a surprise announcement in Budget 2016, the top rate of CGT will reduce from 28% to 20% with the basic rate falling from 18% to 10% on gains. This will affect disposals made on or after 6 April 2016.

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