CGT and different rates of taxpayers?

[Foss62]

Obviously a hot topic at the moment, but not afraid of showing my ignorance I am a bit baffled by the concept of different “rates” of taxpayers in turn paying different rates of CGT.
To me a taxpayer is not fixed in any way to a particular tax band - their classification only emerges at the end of a tax year, either by self assessment or by employer/HMRC.
So when the newspapers talk about basic rate and higher rate taxpayers they are talking about statuses that may well change at short notice due to things as common as overtime and bonuses for example. I’m OK with this concept, as varying rates of CGT could be applied and re-calculation carried out at the end of a tax year.
What I am not so comfortable about is the apparent ease of ‘gaming’ this.
Is it really the case that someone who has the possibility to keep their annual income below a threshold, by for example subsisting on savings (something many draw-down pensioners could do) would be able to save themselves considerable amounts if selling a second home for example? The opposite of this would be someone unable to control their income (an employee on a salary)?
It seems too simplistic not to say unfair.

[Beggarall]

The current rates and application of CGT are described here. I am not sure what you mean by "gaming" but if you mean that sometimes people vary the amount of CGT-liable assets they dispose of to keep within the current tax bands - then I am sure you are right - but I wouldn't really call it gaming. I think it would be difficult to apply this to second homes because they are a single asset and therefore the gain (or loss) is taken all-at-once but quite possible to do with stocks and shares.

Edited by Beggarall on Sunday 27th October 11:04

[Foss62]

Beggarall said:

The current rates and application of CGT are described here. I am not sure what you mean by "gaming" but if you mean that sometimes people vary the amount of CGT-liable assets they dispose of to keep within the current tax bands - then I am sure you are right - but I wouldn't really call it gaming. I think it would be difficult to apply this to second homes because they are a single asset and therefore the gain (or loss) is taken all-at-once but quite possible to do with stocks and shares.

Edited by Beggarall on Sunday 27th October 11:04

The bit I was confused about can be seen in your link: “If you are a higher rate taxpayer”, “If you pay basic rate tax” etc. This implies to me that you start from that point - hence my (maybe badly chosen) word ‘gaming’. In other words making sure for example that if you intend to sell a second house that you would otherwise be a basic rate taxpayer in that year and that would set your CGT rates for the sale.
From their example however, it seems that this might be irrelevant - the gain is added to your other income, so a basic rate payer could become a higher rate one at that point from the perspective of calculating CGT rates on the extra amount.
If that is the case then the HMRC website seems unnecessarily opaque in its explanation.

[Beggarall]

Up till now CGT has been one of the less punitive taxes to have to pay because even the top rate is "better" than income tax plus there was also a tax-free allowance and smallish gains weren't charged at all. However these benefits have been gradually whittled down and I expect we will see more changes with the Chancellor's plundering on Wednesday. I think we will all have to revise our thinking afterwards.