We are selling a rental property and as such Capital Gains Tax (CGT) applies on profits. On 6th April 2023, the personal CGT allowance is being reduced from £12,300 to £6000.

Our sale is likely to complete around this date and with two owners, that means we potentially stand to pay CGT on an additional £12,600.

Somebody told me that the key factor in the date cut-off is when contracts are exchanged for the sale, rather than when the sale is completed. But I cannot find any information supporting or rejecting this claim. Can anyone give an evidence-based answer either way?

1 Answer 1


It's the date of exchange, referred to as the "disposal date".

See the gov.uk guidance:

Capital Gains Tax is a tax on the profit when you sell (or ‘dispose of’) something (an ‘asset’) that’s increased in value.

And the HMRC Capital Gains Manual:

What date did you exchange contracts?

This is the disposal date. The contract exchange date is usually when the buyer and seller exchange contracts and is usually when the new owner pays a deposit.

The tax year of exchange is the tax year that the disposal is chargeable in, even if completion of the contract occurs in a later tax year.

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