United Kingdom · Capital gains tax on property
Capital Gains Tax After Divorce (UK Property)
A transfer of UK property between spouses or civil partners on separation is normally no-gain, no-loss, so no capital gains tax is due on the transfer itself. Tax arises when the person who receives the property later sells, on the gain over the original cost, at 18 or 24 per cent after the £3,000 annual exempt amount.
Transfers of property between spouses or civil partners are normally on a no-gain, no-loss basis, so no capital gains tax arises on the transfer itself.
About 0.0% of your £100,000 gain. You keep roughly £100,000.
How we got this
| Sale price | £300,000 |
| Less purchase price | −£200,000 |
| Less costs and improvements | −£0 |
| Gain | £100,000 |
| No gain / no loss transfer | −£100,000 |
| Less Private Residence Relief | −£0 |
| Less annual exempt amount | −£0 |
| Taxable gain | £0 |
| Band | Amount | Rate | Tax |
|---|---|---|---|
| Estimated CGT | £0 |
- Treated as a no-gain, no-loss transfer, so no capital gains tax arises now. Your spouse or civil partner takes over your original purchase price as their base cost, and tax is charged when they later sell.
A UK residential sale with tax to pay must be reported and paid within 60 days of completion. For a sale completing today, that window runs to about 5 November 2026.
On these figures there is no capital gains tax to pay, so a UK resident does not need to file the 60-day property return. A non-resident must report a disposal of UK property whether or not any tax is due.
This is an estimate for general information only, not tax, legal or financial advice. Tax rules are complex and depend on your circumstances, and figures may not reflect the latest changes. Confirm your position with HMRC or a qualified tax adviser before acting. The terms of use set out the limits of this estimate and of our liability.
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Is there capital gains tax when property is transferred on divorce?
When a couple separates, transferring a share of a property to the other spouse or civil partner is usually treated as no-gain, no-loss, so there is no capital gains tax at the point of transfer. Tax can arise later, when the person who received the property sells it, and their cost carries over from the transfer. The rules on the timing of separation and the family home are detailed, so confirm your position with HMRC or an adviser. The calculator below estimates the tax on an eventual sale.
What happens to the gain after the transfer?
The spouse or civil partner who receives the property takes over the original cost, not its value at the date of transfer. Nothing is taxed at the point of transfer, but the whole gain since the original purchase is still there and falls due when that person sells.
That matters when deciding what a share of the property is actually worth in a settlement: a half share carrying a large embedded gain is worth less after tax than the same share of a recently bought property.
The rules on the timing of separation, and on the family home in particular, are detailed and depend on dates. Confirm your own position with HMRC or a qualified adviser before relying on any figure.
What does the tax actually come to?
The table below is produced by the same engine as the calculator above, at four gain sizes and the two income positions most people are in.
| Gain | Basic-rate seller | Higher-rate seller | Higher-rate couple, jointly owned |
|---|---|---|---|
| £20,000 | £3,618 | £4,080 | £3,360 |
| £50,000 | £10,818 | £11,280 | £10,560 |
| £100,000 | £22,818 | £23,280 | £22,560 |
| £200,000 | £46,818 | £47,280 | £46,560 |
Estimates for 2026/27, after the £3,000 annual exempt amount. A basic-rate seller here has £30,000 of other income, a higher-rate seller £60,000.
When do you have to report and pay?
Within 60 days of completion, through an HMRC Capital Gains Tax on UK property account. The deadline runs from completion, not from exchange and not from the end of the tax year, and the tax is payable by the same date.
A return is still needed even when the estimate here comes to nothing, in some situations. A UK resident with no tax to pay generally does not have to file, but a non-resident must report every disposal of UK property whether or not any tax is due.
Missing the deadline brings an automatic penalty, and interest runs on the unpaid tax from the due date.
What do people most often get wrong?
- Assuming the no-gain, no-loss treatment lasts indefinitely after separation. The timing rules matter and the position changes once the transfer falls outside them.
- Forgetting that the receiving spouse inherits the original cost, so the deferred gain reappears on a later sale.
- Overlooking that the family home may still attract Private Residence Relief for the period either person lived there.
Common questions
Is there capital gains tax when transferring a house in a divorce?
Transfers between spouses or civil partners are normally no-gain, no-loss, so no tax is due on the transfer. Tax can arise when the receiving person later sells.
Who pays the tax on the family home after divorce?
It depends on who ends up owning and selling the property and whether Private Residence Relief applies to their period of occupation. The timing of the separation matters, so take advice.
What is the capital gains tax allowance for 2026 to 2027?
The annual exempt amount is £3,000 per person, or £6,000 for a couple who own the property jointly.
When must UK property capital gains tax be reported?
Within 60 days of completion, through an HMRC Capital Gains Tax on UK property account.