	2006/2007	2005/2006
Taxed as top slice of savings income
Annual exemption
- individual	£8,800	£8,500
- settlement(s) (spread over total number)	£4,400	£4,250

Transfers between spouses and civil partners living together are exempt

Chattels exemption
(proceeds per item or set)	£6,000	£6,000

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 completed 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 completed years held after 5 April 1998	% gain chargeable
1	100
2	100
3	95
4	90
5	85
6	80

Business Assets

No. of completed 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 tax on trustees are usually taxed at the special trust rate of 40%.

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Tunbridge Wells

Kent TN1 1NU

01892 507 280

info@wellsassociates.com

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Wells Associates is the trading name of Wells Professional Partnership LLP which is registered to carry on audit work and regulated for a range of investment business activities by the Institute of Chartered Accountants in England & Wales.

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