Taper Relief

For gains realised after 5 April 1998 by individuals or trustees, indexation allowance is frozen and the gain reduced by a tapering relief. The value of the taper relief depends on whether or not the asset is a business asset, and on the number of complete years the asset has been held after 5 April 1998 (with an additional "bonus" year for non-business assets held on 16 March 1998).

Non-Business Assets
No. of complete years held after 5 April 1998	% gain chargeable
1	100
2	100
3	95
4	90
5	85
6	80
7	75
8	70
9	65
10 or more	60

Business Assets
No of complete years held	Disposals
	% of gain chargeable
0	100
1	50
2 or more	25

Notes

1. Transfers between spouses and civil partners living together are exempt.
2. Capital gains are regarded as the top slice of savings income. Rates of 10%, 20% and 40% will therefore apply to gains taxed on individuals, as appropriate. Gains taxed on trustees are usually taxed at the special trust rate of 40%.

That the Government expect to raise £4.6 billion of its £553 tax generating programme from capital gains tax. Significantly this is an increase of almost 20%. As shown above the top rate of tax on capital gains is currently 40%.