Capital gains tax: the maths, and the catch.

An investor buys £100,000 of shares outside an ISA or pension. They rise in value to £160,000.

If the investor sells the shares, the potential capital gains tax calculation looks like this:

That's assuming the entire taxable gain falls within the 24% band, with no allowable losses or deductible costs.

Under current rules, CGT on ordinary share gains is charged at 18% within the unused basic-rate band and 24% above it.

Now for the Budget twist.

Reports suggest the Chancellor has ruled out increasing CGT rates at the 28 October Budget, including proposals to align them with income tax.

But these are reports based on Treasury sources, not a formal policy announcement.

And the economics help explain the caution.

Higher CGT rates don't necessarily mean higher tax receipts. Investors can delay selling assets, potentially reducing the amount of tax collected.

HMRC's own modelling suggests that increasing the higher CGT rate by 10 percentage points could reduce annual tax receipts by approximately £3.6 billion by 2028/29, after accounting for behavioural responses.

The catch?

Even if rates remain unchanged, that doesn't necessarily protect the annual exempt amount, reliefs or other CGT rules.

For investors holding substantial unrealised gains outside ISAs and pensions, the Budget detail still matters.

The headline is about tax rates. The real issue is what investors actually pay.

General information only, not personal tax or financial advice.

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