Capital Gains Tax (CGT)
You only pay CGT on the profit above your Capital Gains Tax allowance. In the 2019/20 tax year, this CGT allowance is £12,000.
If you’re an individual taxpayer and you have made a capital gain above the CGT allowance, then you would need to file a Self Assessment tax return to declare this profit and pay tax on it.
Other types of earnings are taxed differently — for example, if you earned income from self-employment or rental income from hosting on Airbnb, then then you pay Income Tax instead. You don’t add these earnings together with your capital gains — they have their own tax rates and allowances.
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