Andy Egwim explains how to dodge UK capital gains tax using pensions and ISAs. He sold shares on October 23rd before the Chancellor raised CGT rates a week later, turning a rumour into perfect timing. Pensions and ISAs shelter your gains from tax entirely.
October 23 (year implied by context).
October 30 (year implied by context).
From 10% to 18%.
From 20% to 24%.
So basically your pension port, you don't pay capital gains tax. Now, if you put in money, like for instance, putting money into your pension, like your sip, and you are investing it, or even your employer's pension, you invest in it normally you should be paying what we call capital gains. When you pull out the money, you buy a house for 200k and you sell it for 250k, you've made £50,000. It's called Capital gains. The government usually says, can we have some of that? Last year, for those that read my weekly email, one of the emails I sent on a Sunday like this was why I'm selling all my shares, because I sold all my shares that were outside an ISA and then moved them into ISAs, whether it's my own or family ISAs, because I was hearing rumors that the government was about to put up the capital gains tax on Halloween. That's exactly what they did. So I did this on October 23rd. And by October 30th, the Chancellor of Exchequer Rees announced that capital gains tax was going up from 10% to 18% for basic rate taxpayers. So you're 20% taxpayer and from 20% to 24% for higher rate taxpayers. And it was immediate effect. So if I hadn't done that, I would have lost thousands in tax. So basically your pension port, you don't pay capital gains tax, your ISAs, you don't pay capital gains tax.
