Three years ago a UK investor could take £12,300 of gains a year out of a general investment account and pay nothing. For 2026/27 that figure sits at £3,000 — a 76% cut in two steps — and the rate on a higher-rate taxpayer's share gains rose from 20% to 24% on the afternoon of the Autumn Budget on 30 October 2024. The annual exempt amount used to be generous enough that most retail portfolios never troubled HMRC. That era is over, and the people most exposed are exactly the ones who did the sensible thing and built a taxable GIA after filling their ISA.
None of this means your gains are suddenly being confiscated. It means timing, record-keeping and the order in which you sell now matter in a way they genuinely did not a few years ago. Get the mechanics right and a couple with two ISAs and two CGT allowances can still shelter a serious amount each year. Get them wrong — sell in the wrong tax year, ignore the pooling rules, trip the 30-day clock — and you hand over money you never needed to lose.
What actually changed, and what it costs you
The annual exempt amount is the slice of gains you can realise each tax year before any CGT is due. It was £12,300 up to 5 April 2023, dropped to £6,000 for 2023/24, and has been £3,000 since 6 April 2024 — where it remains for 2026/27. There is no inflation uprating built in, so in real terms it shrinks every year the Treasury leaves it frozen.
The rates on gains above that allowance now sit at 18% for any portion falling within your basic-rate band and 24% for anything above it. Before 30 October 2024 those same share gains were taxed at 10% and 20%, so the headline cost of selling a chunk of a winning fund has risen by roughly a fifth for most people who use a GIA at all. The 18%/24% rates apply to shares, funds and most other chargeable assets; residential property that isn't your main home sits at 24% too, having previously had its own higher band.
A worked figure makes it concrete. Sell £13,000 of gains in one tax year as a higher-rate taxpayer: the first £3,000 is exempt, the remaining £10,000 is taxed at 24%, and HMRC takes £2,400. Split the same disposal across two tax years — £6,500 of gain each side of 5 April — and you use two £3,000 allowances, leaving £7,000 taxable at 24% for a bill of £1,680. Same shares, same total gain, £720 saved by waiting a few weeks.
Section 104 pooling: why you can't just sell "the cheap ones"
Most UK investors assume that if they bought the same fund five times at different prices, they can choose to sell the lot they bought highest to minimise the gain. You cannot. For shares and units of the same class in the same company or fund, HMRC requires you to use the Section 104 holding — a single pool where every purchase is averaged into one combined cost. When you sell, the gain is calculated against that pooled average cost per unit, not against any individual purchase.
Say you hold 1,000 units of a global tracker bought in three tranches: 400 at £8, 300 at £11 and 300 at £14. The pool cost is £10,300, an average of £10.30 a unit. Sell 500 units at £15 and your proceeds are £7,500, your allowable cost is 500 × £10.30 = £5,150, and your gain is £2,350 — comfortably inside the £3,000 allowance, so no tax. The averaging is the whole point: you don't get to cherry-pick the £14 tranche to manufacture a smaller gain.
Two rules sit on top of the pool and catch people out. The same-day rule matches any sale against shares of the same class bought on the same day before it touches the pool. The 30-day rule — often called the bed-and-breakfasting rule — matches a sale against any repurchase of the same shares within the following 30 days, again before the pool. That second one exists precisely to stop you selling on 4 April to bank a gain and rebuying the identical holding on 6 April. If you do, HMRC simply ignores the round trip for CGT purposes and your allowance is wasted.
Bed-and-ISA: the move that's still legal, and worth it
The 30-day rule killed the old trick of selling and instantly rebuying the same shares in the same account. What it did not kill is selling shares in your taxable GIA and rebuying them inside your ISA — because once they're in the ISA they are a different tax wrapper, and the 30-day matching rule does not bite across that boundary in a way that undoes the disposal. This is bed-and-ISA, and most major platforms — Hargreaves Lansdown, AJ Bell, interactive investor — run it as a single instruction so you're out of the market for minutes rather than days.
The logic is straightforward. You crystallise a gain in the GIA up to your £3,000 allowance, pay no CGT on it, and the shares land in the ISA where all future growth and dividends are sheltered for good. Do this every April with £3,000 of gains and over a decade you migrate a meaningful taxable holding into a tax-free one without ever triggering a bill. It uses up part of your £20,000 annual ISA subscription, so it competes with new cash you might add — but for anyone sitting on a large GIA, sheltering existing gains usually beats leaving them exposed to a frozen allowance that keeps shrinking.
There's a cost worth naming honestly. You'll pay the bid-offer spread on the round trip, any dealing charge your platform levies, and on AIM or smaller LSE-listed shares the 0.5% stamp duty on the repurchase. On a £3,000 transfer that's typically £15 to £40 all-in. Set against a future where those gains would otherwise be taxed at 24%, it's one of the cheapest pieces of tax planning a retail investor has left.
Don't forget the £50 dividend problem hiding next door
CGT isn't the only allowance the Treasury has quietly gutted. The dividend allowance — the amount of dividend income you can receive tax-free outside an ISA or pension — fell from £2,000 in 2022/23 to £1,000, then to just £500 from April 2024, where it stays for 2026/27. A GIA holding income-paying shares now generates a tax liability on dividends far sooner than it used to, taxed at 8.75%, 33.75% or 39.35% depending on your band.
This changes which holdings you prioritise for the ISA. If you have to choose what to bed-and-ISA first, lead with the high-yielding holdings, not the growth ones. A FTSE 100 income fund yielding 4% on a £25,000 GIA position throws off £1,000 a year in dividends — double the allowance — and that's a recurring annual tax charge, whereas a non-dividend-paying growth tracker only ever costs you when you sell. Shelter the thing that's taxed every year before the thing that's taxed once.
Practical sequence for the 2026/27 year
The mechanics reward a little discipline in the spring. Before 5 April, work out your realised gains for the year so far, then top up to — but not over — the £3,000 exempt amount by selling winners, ideally via bed-and-ISA so the proceeds move into shelter rather than back into a taxable holding. Keep a running record of every purchase price and date, because the Section 104 pool is your responsibility to compute, not your platform's, and HMRC expects the workings if they ask.
- Check your year-to-date realised gains in March, not on 4 April when platforms are jammed and trades may not settle in time.
- Use both spouses' allowances — a transfer of assets between spouses or civil partners is exempt from CGT, so moving a holding to the lower-rate partner before sale can cut the rate from 24% to 18%, or use their unused £3,000.
- Realise losses in the same year as gains; they net off pound-for-pound, and surplus losses carry forward indefinitely if you report them.
- If a single gain is large, split the disposal across two tax years to use two annual allowances — the £720 saving in the earlier example scales up fast.
One caveat that catches the over-keen: don't let the tax tail wag the investment dog. Selling a holding you'd otherwise keep, purely to use an allowance, only makes sense if you're rebuying it in a shelter or genuinely rebalancing. Crystallising a gain on something you then sit on in cash, just to "use the £3,000", can leave you out of the market and worse off than the tax you saved. The allowance is a tool for shifting money into shelter and managing rebalances — not a use-it-or-lose-it prize to chase for its own sake.
The direction of travel from the Treasury is unmistakable: smaller allowances, higher rates, no inflation protection. For a UK investor with a GIA, the response isn't despair — it's a standing April routine. Three thousand pounds of sheltered gains, the right holdings moved first, both partners' allowances in play, and a clean record of the pool. Do that consistently and the frozen allowance stops being a slow tax rise and becomes a yearly habit that quietly empties your taxable account into your ISA.