Capital Gains Tax UK: What is Capital Gains Tax? How will it be overhauled?

How is Capital Gains Tax going to change?

Mr Sunak commissioned a review of Capital Gains Tax in July in a bid to plug the economic hole created by the coronavirus crisis.

On Wednesday, OTS published a highly anticipated report into Capital Gains Tax which concluded the current rules were “counterintuitive” and created “odd incentives” in several areas.

The recommendations from independent tax adviser the Office of Tax Simplification (OTS) could raise more than £18 billion a year.

Those hardest hit by the proposals will be wealthy individuals who hold second homes or assets outside tax-favoured products.

If the new measures are implemented, the proposals will also hit owner-directors of small companies who often hold cash within their businesses for use as a pension when they retire.