Your Income Tax Band (Personal Ownership)
Gain on Sale
£92,000
Before the £3,000 annual exempt amount (personal only — companies get no equivalent allowance).
Held Personally
Held via Limited Company
Illustrative only. Assumes the property is not your main residence (no Private Residence Relief), and for the Ltd company scenario, that the gain is the company's only chargeable profit for the year (no indexation allowance applies to gains on assets acquired after December 2017, and none has applied to companies since). Doesn't include dividend or salary extraction tax if you later withdraw the proceeds from the company. Not financial or tax advice — always confirm with an accountant before selling.
What This Calculator Does
This tool calculates the capital gains tax due when you sell a UK investment property, comparing what you'd owe as an individual landlord against what a limited company would owe in corporation tax on the same sale.
Enter the original purchase price, sale price, buying and selling costs, and any capital improvements (not routine repairs) — the calculator works out your gain, then applies personal CGT rates with the annual exempt amount, or corporation tax with marginal relief, depending on which panel you're comparing.
How the Calculation Works
Gain = selling price − purchase price − buying costs − selling costs − capital improvements. This is the same starting figure for both ownership structures — only the tax treatment differs from here.
Personal: the first £3,000 of gain each tax year is exempt, then the remainder is taxed at 18% (basic rate) or 24% (higher/additional rate) — the rates for residential property, which have applied since 30 October 2024 and are unchanged for 2026/27.
Limited company: there's no annual exempt amount and no indexation allowance for assets acquired after December 2017. The full gain is added to the company's profits for the year and taxed at the same corporation tax rates as trading profit — 19% up to £50,000, 25% above £250,000, tapered marginal relief in between.
Worked Example
A property bought for £250,000 and sold for £350,000, with £3,000 in buying costs and £5,000 in selling costs, owned by a higher-rate taxpayer.
- Gain: £350,000 − £250,000 − £3,000 − £5,000 = £92,000
- Personal: taxable gain after £3,000 exemption = £89,000 × 24% = £21,360
- Ltd: chargeable gain = £92,000, taxed with marginal relief ≈ 22.4% = £20,630
£21,360 in personal CGT versus £20,630 in corporation tax — only £730 apart at this gain level, since the marginal relief band brings the effective Ltd rate close to the personal higher rate. The gap widens more clearly at larger gains, where personal CGT stays flat at 24% but the Ltd effective rate only climbs to 25% once profits pass £250,000.
Frequently Asked Questions
Do I pay CGT if the property was my main home?
No — Private Residence Relief exempts gains on your only or main home for the periods you lived in it, which this calculator doesn't model since it's built for investment property sales. If a property was your main home for only part of the ownership period (e.g. you let it out after moving), a proportion of the gain can still be exempt — get specific advice for mixed-use history.
How much is the annual exempt amount, and can I use my spouse's too?
The 2025/26 annual exempt amount is £3,000 per individual. If you jointly own the property with a spouse or civil partner, each of you has your own £3,000 allowance against your share of the gain, effectively doubling the exempt amount for a jointly-owned property.
Is capital gains tax the same for companies as for individuals?
No. Companies don't pay capital gains tax — a property sale by a limited company is a "chargeable gain" added to trading profits and taxed at corporation tax rates (19–25%), not the personal 18%/24% CGT rates, and with no £3,000-equivalent annual exemption.
How and when do I actually pay the CGT?
For UK residential property, you must report and pay CGT within 60 days of completion using HMRC's "Report and pay Capital Gains Tax on UK property" service — this is much faster than waiting for your annual Self Assessment deadline, and penalties apply for late reporting even if no tax is ultimately due.
Does incorporating before selling avoid CGT altogether?
No — transferring a property you already own personally into a company is itself treated as a disposal, so it can trigger the exact CGT bill (plus stamp duty on the transfer) that incorporating was meant to avoid. The corporation tax comparison here is most relevant for a property bought by the company from the start, not an existing personal property moved in later.