15 March 2023 l BUDGET 6 4 9 Investor definitions Legislation will reinstate the previous (pre-31 January 2024) eligibility criteria for an individual to qualify as a high net worth or sophisticated investor. There will be further work to review the scope of the exemptions. CAPITAL TAXES Capital gains tax (CGT) annual exempt amount The CGT annual exempt amount for individuals and personal representatives will be cut to £3,000 for 2024/25. The annual exempt amount for most trusts will likewise fall to £1,500 (minimum £300) as previously announced. The allowance will no longer be index linked. From 6 April 2024, the higher rate of CGT for residential property disposals will be cut from 28% to 24% while the lower rate (for any gains that fall within an individual’s basic rate band) will remain at 18%. Inheritance tax (IHT) The IHT nil rate band will remain at £325,000 from 2024/25 to 2027/28, as previously announced. The residence nil rate band (RNRB) likewise stays at £175,000 and the RNRB taper continues to apply until April 2028 if the value of a deceased person’s estate is greater than £2 million. Payment of IHT From 1 April 2024, personal representatives of estates will no longer need to have sought commercial loans to pay IHT before applying to obtain a ‘grant on credit’ from HMRC. > SAVER Don’t waste your CGT annual allowance. The annual exempt amount for personal capital gains will be reduced from £6,000 to £3,000 for 2024/25. You should consider realising gains before the end of the tax year and reinvesting.
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