What is capital gains tax?
Capital gains tax (CGT) is charged on capital gains accruing to an individual or non-corporate person in a tax year. It was first introduced in the UK in 1965 to tax gains that were escaping income tax. For example, if you sold an investment (a source of income such as a house rented in flats) that you had held for several years, you could claim the gain was “capital” and therefore not liable to income tax.