What if capital gains tax goes to 45%?
The Budget is rumoured to align CGT with income tax. Drag the rate and watch your bill climb.
After losses, before the £3,000 allowance
Salary and other income, before tax
Or try an example
45%
The rumour
Satire. What the data actually says
Full alignment with income tax at 20/40/45%, put to No 10 and the Treasury by Labour donor Dale Vince to pay for a higher personal allowance.
Departures board: DUBAI boarding, MILAN boarding, ZUG check-in, MONACO check-in.
Your CGT today
£23,280
At 45%
£40,393
That’s £17,113 more (+74%).
The extra tax is roughly
- London pints
- 2,632
- return flights to Dubai
- 34
- years of state pension
- 1.4
Sweeten the pill: add indexation
Only tax the gain above inflation, as the UK did from 1982 until 1998.
On a long-held asset, most of the “gain” can be inflation.
What the Treasury gets
HMRC’s own estimate of the change in CGT receipts in 2028-29.
Off the Treasury’s chart
HMRC hasn’t costed anything above +10 points.
HMRC estimates that raising the higher rate by 10 points would lose about £3.6bn, as people hold on to assets instead of selling. The IFS thinks a rise would raise money over a longer horizon “up to a point”. HMRC source
Show the working
Gains are stacked on top of your income. At 45% the calculator assumes 20% in the basic-rate band, 40% in the higher-rate band and 45% above £125,140. That is the path full alignment with income tax (20/40/45%) would take.
Today (18% / 24%)
| Gain | £100,000 |
| Annual exempt amount | −£3,000 |
| Higher-rate band: £65,140 × 24% | £15,634 |
| Above £125,140: £31,860 × 24% | £7,646 |
| CGT | £23,280 |
At 45%
| Gain | £100,000 |
| Annual exempt amount | −£3,000 |
| Higher-rate band: £65,140 × 40% | £26,056 |
| Above £125,140: £31,860 × 45% | £14,337 |
| CGT | £40,393 |
A what-if tool, not a forecast: nothing here has been announced. Today’s figures use 2026 to 2027 rates and the £3,000 annual exempt amount. The personal allowance taper above £100,000, Business Asset Disposal Relief and other reliefs are left out. Not tax advice, so speak to a qualified adviser before acting on Budget speculation.
Crowd forecast
What rate will John Healey pick?
Set the slider above to your prediction, then lock it in. One vote each, until the speech starts on Wednesday 28 October 2026.
Voting stores your chosen rate and a salted hash of your IP address (never the address itself) for 90 days, to allow one vote per connection. Your browser also remembers your vote so it can show it back to you.
What’s actually being proposed
Andy Burnham has promised not to raise the main rates of income tax, National Insurance or VAT, and the Treasury needs money. That leaves taxes on wealth, and capital gains tax is the one most often named. The rumour is alignment with income tax: 20% for basic-rate taxpayers, 40% for higher and 45% for additional, against 18% and 24% today.
8 Jul
Louise Haigh and Wes Streeting, both now in Andy Burnham’s Cabinet, are on record backing moving CGT closer to income tax rates. Sky News
1 Sep
Lord O’Neill tells LBC that with the main taxes ruled out, CGT “looms out” as the obvious target. S&W
16 Sep
Labour insiders call a CGT rise the “front runner” among revenue options. The i Paper
20 Sep
No 10 and the Treasury are reviewing a submission from Labour donor Dale Vince to raise CGT as high as 45% to pay for a £15,570 personal allowance. The Telegraph
23 Sep
CenTax estimates that aligning CGT with income tax, as part of a wider reform package, would raise £19.7bn in 2029-30. CenTax
25 Sep
Landlords’ association the NRLA warns against “blanket equalisation” and asks for any rise to account for inflation. NRLA
27 Sep
John Healey tells The Sunday Times the UK has the “lowest capital gains tax (CGT) of any European G7 nation”, but won’t give “signals that will fuel Budget speculation”. City AM
6 Oct
Tax Policy Associates argues the rumours have already pulled sales forward, leaving CGT reform “dead” for this Budget. Tax Policy Associates
8 Oct
Burnham and Healey are reported to be weighing equalisation, taking the top rate from 24% to 45%. The Telegraph
Would it raise any money?
- CGT due on 2024-25 gains, a record
- £24.2bn
- CGT due on 2024-25 gains, a record
- people paid CGT that year, up 45%
- 584,000
- people paid CGT that year, up 45%
- of crypto gains reported by 17,600 people
- £1.38bn
- of crypto gains reported by 17,600 people
Source: HMRC CGT statistics
Nobody agrees on what a rise would add. The £14bn behind the Vince proposal comes from a 2024 CenTax package, updated to £19.7bn in September. Both pair higher rates with an investment allowance and an end to the CGT uplift on death. Neither is a bare rate rise.
The Treasury’s own costings point the other way. HMRC’s ready reckoner estimates that raising the higher rate by one point would reduce receipts in 2028-29 by about £30m, by five points about £870m, and by ten points about £3.6bn, because people hold on to assets rather than sell. The IFS thinks those estimates understate the longer-run yield, but agrees that simply raising rates “would discourage saving and investment”. Tax advisers Blick Rothenberg expect any rise to stop around 30%.
Indexation: the sweetener
Today, CGT taxes gains that are only inflation. Geoffrey Howe introduced an indexation allowance in 1982 so that only real gains were taxed, and in 1988 Nigel Lawson taxed gains at income tax rates on top of it. The IFS, Tax Policy Associates and the NRLA have all argued that a higher rate should come with some allowance for inflation.
It helps some people far more than others. Here are the calculator’s examples at the rumoured 45%, with the cost uplifted by CPI to 2026:
| Example | Today | 45% | 45% with indexation |
|---|---|---|---|
| LandlordBuy-to-let bought for £250k in 2016, sold for £360k | £25,364 | £43,089 | £28 |
| Founder selling upStartup shares bought for £1,000 in 2018, sold for £2m | £479,040 | £894,943 | £894,778 |
| Crypto HODLer£10k of Bitcoin bought in 2021, now worth £60k | £11,280 | £18,800 | £17,535 |
| Shares outside an ISA£60k of funds bought in 2012, now worth £100k | £8,880 | £14,800 | £2,369 |
Indexation is a landlord’s lifeline and a founder’s irrelevance. A buy-to-let held for a decade is mostly inflation, so even at 45% the indexed bill is below today’s. A founder who started with £1,000 of shares gets nothing back, because there was almost no cost to index. Crypto held for a few years sits in between, much closer to the founder.
Inflation from ONS series D7BT (CPI, 2015=100), release of 16/09/2026.
Is there really an exodus?
The departures board above is a joke. The data is less dramatic. Henley & Partners, the source of the widely reported claim that 16,500 millionaires would leave the UK in 2025, has dropped those numbers and now calls millionaire migration “modest”. HMRC figures reported by the FT showed the number of non-doms fell by just 0.5% in 2024-25.
Individual departures are real. Revolut’s founder moved his residence to the UAE, and founders who can relocate before selling are the people a higher rate most tempts to leave. But they are a handful, not a crowd. The loss in the Treasury meter is HMRC’s own estimate. The queue at Heathrow is not.
Capital gains tax since 1965
196530%
CGT introduced at a flat rate
198230%
Indexation: only gains above inflation are taxed
1988Up to 40%
Taxed at income tax rates, on top of indexation
199840%
Indexation frozen; taper relief cuts the rate the longer you hold
200818%
One flat rate; taper relief and indexation abolished
201028%
New higher rate for higher-rate taxpayers
201620%
Cut to 20% and 10% for most assets
202424%
18% and 24% for all assets from Budget day, 30 October
2026?
Wednesday 28 October 2026
Sources: IFS and the House of Commons Library. Top rates shown; lower rates and reliefs varied.
Need today’s bill, not a what-if?
The crypto tax calculator and the capital gains tax calculator work out a real disposal at 2026-27 rates.
Capital gains tax and the Budget
Is capital gains tax going up in the 2026 Budget?
Nothing has been announced. CGT has been widely reported as the front runner for a tax rise at the Autumn Budget on 28 October 2026, and a proposal to align it with income tax at up to 45% has been put to No 10 and the Treasury. Until the Chancellor speaks, every figure on this page is a what-if.
What are the capital gains tax rates now?
For 2026-27, 18% on gains that fall within the basic-rate band and 24% above it, after a £3,000 annual exempt amount. Gains that qualify for Business Asset Disposal Relief are taxed at 18% from 6 April 2026.
If CGT goes up, when would it start?
It could be immediate. The last rise, in October 2024, applied to disposals made from Budget day itself, so selling on the day did not beat it. A rise could also be phased in or start from 6 April. The Dale Vince proposal reportedly favours phasing.
Should I sell before the Budget?
That depends on your circumstances, and a calculator can't decide it. Selling early crystallises a gain you might otherwise defer, can use up allowances, and can't be undone if rates don't change. Speak to a qualified adviser before acting on speculation.
What is indexation?
Indexation increases what an asset cost you by the inflation since you bought it, so only the real gain is taxed. Individuals had it from 1982 until it was frozen in 1998 and abolished in 2008. Companies kept it until December 2017. The calculator uses the ONS consumer prices index.
Would a rise affect selling my home?
Usually not. Private Residence Relief means most people pay no CGT when they sell their main home. A rate rise would hit gains on second homes, buy-to-lets, shares held outside an ISA or pension, business assets and crypto.
Does capital gains tax apply to crypto?
Yes. Selling, swapping, spending or gifting crypto is usually a disposal for CGT, so any change to CGT rates would apply to crypto gains too. HMRC statistics show 17,600 people reported £1.38bn of cryptoasset gains in 2024-25.
How does the calculator turn one slider into tax rates?
It follows the path full alignment with income tax would take. Below 40% only the higher rate moves. From 40% the basic-rate slice is taxed at 20%, and at 45% the schedule is exactly 20%, 40% and 45%. Above that both upper bands keep rising until, at 100%, everything above the basic-rate band goes in tax.