Ndubuisi 'Andy' EgwimMoney Coach for Medics|Ex-NHS GP|21+ Yrs Investor| Founder, MoneyWiseDoctor.com|Helping Medics Avoid Big Money Mistakes

The CGT Allowance Cut That Is Quietly Costing UK Doctors Investing Outside an ISA

8 May 2026 · 1 min

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In this segment, Ndubuisi 'Andy' Egwim explains recent UK tax changes that disproportionately affect investors who hold assets outside tax‑advantaged wrappers, with a particular focus on doctors. He details how the Capital Gains Tax (CGT) annual exempt amount has been slashed from £12,300 in 2022 to just £3,000—a 75% reduction over four years—removing a key safety net for non‑ISA investors. He then outlines the April 2023 increase in dividend tax rates (basic‑rate from 8.75% to 10.75% and higher‑rate from 33.75% to 35.75%), meaning every pound of dividend earned outside an ISA or pension now incurs higher tax. By contrast, investments held inside an ISA incur zero CGT and zero dividend tax, underscoring the importance of using ISAs (or pensions) to protect investment returns, especially for high‑earning professionals like doctors who may be more exposed to these tax burdens.

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Here is a wider context that makes this even more frustrating for some investors, especially doctors. The CGT exempt amount, that's the amount of gains you can make before paying any tax, has been cut from £12,300 in 2022 down to £3,000. It's £3,000 today, so that's a 75% reduction in 4 years. Now, the government has steadily removed the safety net that once gave investors breathing room outside tax wrappers. So inside an ISA, there's no CGT ever on any amount. So that's why ISAs are important. Number 2, April 2023, right now, dividend tax rate has gone up, okay? Basic rate taxpayers, instead of 8.75%, now have to pay 10.75%. Now, higher rate taxpayers, instead of 33.75%, now have to pay 35.75%. If you hold dividend-paying investment outside an ISA or a pension wrapper, Whether it's individual stocks or index funds or investment trusts, you're now paying more tax on every pound of dividend received. Inside an ISA, how much do you have to pay in dividend tax? Zero. Zero. Nothing.