The Government collected a record amount from capital gains tax last year after rates increased under former chancellor Rachel Reeves, helping reel in an extra 180,000 taxpayers.
Capital gains tax receipts totalled £24.2 billion in the 2024-25 tax year – an 89% increase on the year before, data from HM Revenue & Customs (HMRC) shows.
The number of capital gains taxpayers increased by 181,000, or 45%, to an all-time high of 584,000, the data showed.
Policy changes behind the spike
The tax is paid on the profits of the sale or disposal of an asset, including businesses and properties.
The Labour Government announced changes to the tax policy in its first autumn budget in 2024 as part of efforts to raise billions more pounds for the Treasury.
This included an increase to the main rates of capital gains tax, from 10% to 18% for basic-rate taxpayers and from 20% to 24% for higher-rate taxpayers, on disposals made after October 2024.
Factors driving higher receipts
Cuts to tax relief in previous years also contributed to the higher amount from receipts last year, HMRC said.
Furthermore, public speculation ahead of the 2024 budget prompted more people to make sales and disposals in the hope of locking in lower tax rates ahead of the anticipated hike.
Sean Cockburn, private client partner at Forvis Mazars, said: “The spike is driven by a number of factors.
“Cuts to annual exemptions have widened the net at the same time as increases to headline rates, while investors, landlords, and businesses have been accelerating asset disposals – both by choice and out of necessity.
“Despite this, CGT remains firmly in the spotlight ahead for the Autumn Budget, with potential changes on the Treasury’s list.”
Cryptocurrency gains revealed
Meanwhile, the new figures from HMRC revealed there were 240 cryptocurrency millionaires in the 2024-25 tax year.
There were 17,600 individuals making disposals of crypto assets such as Bitcoin, Ethereum and Dogecoin that were liable for capital gains tax, amounting to total gains of £1.38 billion.
The data, the first of its kind to be published by HMRC, showed that the vast majority of taxpayers on crypto gains were men, at 87% versus around 13% that were women.
