The CGT surge — what UK contractors need to know about capital gains tax in 2026
Direct Answer
CGT receipts rose 69% year-on-year to £17bn in January 2026. The annual exemption has been cut from £12,300 to just £3,000, pulling tens of thousands of additional taxpayers into scope. HMRC investigations into underpaid CGT have more than tripled. For contractors who hold investments, share awards, or property outside their limited company, the risk of getting this wrong has never been higher.
What has driven the CGT revenue surge?
The short answer: a policy change that caught a lot of people off guard.
The CGT annual exemption — the amount of gains you can make each year before paying any tax — was slashed from £12,300 to £3,000 over recent tax years. At £12,300, the vast majority of individual investors with modest portfolios owed nothing. At £3,000, anyone with a reasonably active investment account is likely to have taxable gains in a decent market year.
HMRC's own figures show receipts jumping from £10bn in January 2025 to £17bn in January 2026. Investigations into underpaid CGT more than tripled, with over £200m recovered in 2025–26 alone.
Why this matters specifically for contractors
Most contractors running limited companies focus on their company tax affairs — corporation tax, VAT, payroll. But CGT is a personal tax obligation, entirely separate from your company's accounts.
Contractors are particularly likely to have CGT exposure because:
- Investment portfolios: Many contractors accumulate general investment accounts (GIAs) alongside ISAs. GIAs are fully subject to CGT on disposal.
- Share awards from client companies: EMI options, RSUs, or share awards granted by a previous employer or client company generate CGT on disposal.
- Buy-to-let property: Gains on residential property sold outside your main residence are taxed at 24% for higher-rate taxpayers.
- Crypto assets: HMRC treats cryptocurrency as a capital asset. Every disposal — including swapping one crypto for another — is a taxable event.
None of these appear on your company's corporation tax return. They must be reported via your personal Self Assessment.
The platform reporting gap: why errors are so common
One of the biggest practical problems is that investment platforms are inconsistent about providing accurate book-cost data — the original purchase price of your shares or funds, which you need to calculate your gain.
When you transfer a portfolio between platforms (say, from one ISA provider to another, or from an employer share scheme to a personal broker), the book-cost data is frequently not transferred alongside the assets. You end up with assets in a new account but no record of what you originally paid for them.
This creates a genuine reporting problem. Many people either guess, use the wrong figure, or skip reporting entirely — all of which puts them in HMRC's sights. The safest approach is to keep your own records of purchase dates and prices for all investment assets, regardless of what your platform shows.
CGT rates for contractors in 2026
Most limited company contractors are higher-rate taxpayers once you account for dividends. That means:
- Residential property gains: 24% (higher rate)
- Other assets (shares, crypto, funds): 18% (higher rate)
- Annual exemption: £3,000 — first £3,000 of gains each year is tax-free
If you have losses from previous years, you can offset these against current-year gains. Losses carried forward must be reported on your Self Assessment even in years when they do not reduce your liability to zero.
How Autobooks handles CGT alongside your company tax
Your limited company accounts are only half the picture. As a contractor, your personal Self Assessment (SA100) needs to capture everything: your salary, dividends, any rental income, and any capital gains.
AutoBooks Gold includes your SA100 as standard — it is not an add-on. When we prepare your personal return, we review your capital gains position alongside your company income. If you have had disposals during the year, we ensure they are reported correctly and that any available reliefs (losses, annual exemption, principal private residence relief on property) are applied.
See our pricing page for full details of what is included, or contact us to talk through your situation.
Don't let a HMRC CGT investigation catch you off guard.
AutoBooks helps UK contractors stay on top of all their tax obligations — company and personal. Get started for £89+VAT/month.