Relaxation of CGT rules for separating couples

29th July 2022


Tax planning is not often at the top of the to-do list when a couple are separating, however, the timing of asset transfers can make a huge difference for tax purposes.


The rules as things stand


Married couples and civil partners can transfer chargeable assets between them without incurring capital gains tax (CGT) under the ‘no gain, no loss’ principle. However, for couples that are separating, this only applies until the end of the tax year in which the separation occurs.

For example, a couple who separated in February 2022 could only transfer assets ‘free of tax’ until 5 April 2022. Chargeable assets transferred after that date could incur CGT.


Changes from 6 April 2023


The Government has released draft legislation, which will allow divorcing couples longer to get their affairs in order, without incurring unwelcome CGT charges.


From 6 April 2023:


  • Couples will have a more generous window of up to three tax years from the year in which they cease to live together as a married couple to transfer assets on a no gain, no loss basis.
  • A Private Residence Relief claim will be possible for a spouse or civil partner who retains an interest in the former matrimonial home, but no longer lives in it as their main home.
  • Private Residence Relief will also be available where one spouse transfers the property to the other spouse but will receive a percentage of the proceeds on a future sale.


Couples who separated prior to 6 April 2022 will only benefit if they are prepared to defer the transfer of assets until after 6 April 2023, which may not be appropriate (or even possible) depending on their circumstances.


Please note that these provisions will only help couples who are separating following the breakdown of a marriage or civil partnership. Unmarried couples do not have access to the same ‘no gain, no loss’ provisions.


Do get in touch with us if you need any assistance. Our contact details are here.

Other items in Blogs
Ellen Carter
11th August 2022 Revisit your remuneration?

For many SME owner-managed businesses, the tax optimum director remuneration structure for many years has been one of a low salary accompanied by high dividends. This allows Companies to take advantage of low dividend tax rates and, in many cases, no employers national insurance to be paid by the company (if paid at the Secondary…

Jaimie King
10th August 2022 Seeing Double: New Recovery Loan Scheme begins

While one government-backed Recovery Loan Scheme (RLS) ends, another opens.   The previous RLS closed on 30th June 2022, but to follow this the government have introduced a new RLS scheme to support businesses through the out-turn of the pandemic, expected to be accessible after 1st August 2022.   The New Recovery Loan Scheme Government…

Charlie Whittle
10th August 2022 Annual Allowance for NHS pensions

What is the annual allowance? The annual allowance for the 2022/23 tax year is £40,000 and each year this is compared with your pension input amounts. Your pension input is defined as the increase or growth in the capital value of your NHS pension benefits across all pension schemes. Any growth in excess of the…

Jake Day
8th August 2022 TRS Registrations: This deadline may apply to you

  1st September 2022 – This deadline may apply to you!   If you hold property or investments on behalf of another person, HMRC may consider this as a reportable trust arrangement. This may mean that you need to register on the Trust Registration Service (TRS) before 1st September 2022.   New legislation now in…

Megan Turner
4th August 2022 Charity Commission annual return: Planned Changes

The Charity Commission has launched a consultation regarding changes to the annual return.   There are a number of new questions, taking the total questions from 36 to 52, although only 32 will be compulsory. The aim of the new questions is to make the annual return more comprehensive, by gaining information around charity’s income…

Ben Beech
3rd August 2022 MP’s call for Government to Introduce Essential User Rebate

The All-Party Parliamentary Group for Road Freight and Logistics has today (27 July 2022) urged the Government to approve the introduction of an Essential User Rebate of no less than 15 pence per litre for operators within the logistics sector to combat the effects of soaring fuel prices and inflation.   The call has come…