1.Section 2 and Schedule 1 change the rates at which capital gains tax (CGT) is charged. This replaces the single rate of 18 per cent for all gains (with gains qualifying for entrepreneurs’ relief being reduced to deliver an effective rate of 10 per cent).
2.The rate of CGT for gains that do not qualify for entrepreneurs’ relief will now be:
18 per cent up to any unused amount of an individual’s income tax basic rate band; and
28 per cent for other gains, including gains of trustees and the personal representatives of deceased persons.
3.The 10 per cent rate for gains qualifying for entrepreneurs’ relief remains, but is now delivered simply by charging those gains at that rate, and the lifetime limit for gains qualifying for the relief is increased from £2 million to £5 million.
4.The changes take effect for gains arising on or after 23 June 2010.