How Capital Gain Tax works on share investments held for multiple years?

Hello everyone,

I’m Andrea and this is my first post on the forum. It’s been some time I’ve got a question in mind, how Capital Gain Tax works on share investments held for multiple years? I mean I have a General investment Account on Freetrade ( so not ISA), opened in April 2020. I bought some shares but if I hold them like until 2025, how would CGT be calculated seeing that I’ll be holding my shares longer than 1 tax year?

Many Thanks

Hey! I am not aware of any special holding period rules for shares bought through a broker like freetrade. So you just pay whatever rate applies on the profit of that transactions, for everything above the £12 300 allowance in the tax year that you sell them in.

Yeah it’s done yearly, you technically haven’t made any capital gains until you sell the positions, then that would apply to the CGT allowance for that particular year. At least that’s my understanding of it.

Many thanks for your answers.

So recapping, if i buy shares this year and i sell them in 2025, going over the allowance that there will be in 2025, i will pay taxes only based on the rates and percentages of the 2025 year. So no cumulative taxes that increase year by year till 2025 ecc

Something like this should give you a ball park figure:

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Yes.

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ok, got it. Thank you very much to all of you for the explanation : )