Giving income to charity to reduce CGT

[996c2]

As I understand it, CGT is 28% if you're a higher income tax rate payer but is only 18% if you're a lower income tax rate payer.

If I am due to have a sizeable capital gain in say 2013/14, can I jump into the 18% CGT band by giving away enough of my income during 2013/14 to be a lower rate taxpayer?

[sumo69]

I don't think you quite understand how the CGT is calculated.

The gains (post annual exemption and losses) are aggregated with your income - the amount that remains in your income tax basic rate band would be liable @ 18% and the remainder @ 28%.

It doesn't mean that if your taxable INCOME is within the basic rate, then the WHOLE of the gain is charged @ 18%.

HTH

David

[996c2]

Thanks for the prompt reply David.

I thought my (mis)understanding of it was too good to be true!