capital gains tax

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A capital gains tax (CGT) is a tax on the profit realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property.
Not all countries impose a capital gains tax and most have different rates of taxation for individuals and corporations. Countries that do not impose a capital gains tax include Bahrain, Barbados, Belize, Cayman Islands, Isle of Man, Jamaica, Sierra Leone, Singapore, and others. In some countries, such as Singapore, professional traders and those who trade frequently are taxed on such profits as a business income.
Capital gains tax can be payable on valuable items or assets sold at a profit. Antiques, shares, precious metals and second homes could be all subject to the tax if you make enough money from them. How much tax is payable can differ. The lower boundary of profit that is big enough to have a tax imposed on it is set by the government. If the profit is lower than this limit it is tax-free. The profit is in most cases the difference between the amount (or value) an asset is sold and the amount it was bought for.
The tax rate of the capital gains tax depends on how much profit you gained and also on how much money you make annually. For example, in the UK the CGT is currently (tax year 2019–2020) 10% of the profit if your income is under £50,000, then it is 20% if your income exceeds this limit. There is an additional tax that adds 8% to the existing tax rate if the profit comes from residential property. If any property is sold with loss, it is possible to offset it against annual gains. The CGT allowance for one tax year in the UK is currently £12,000 for an individual and double (£24,000) if you are a married couple or in a civil partnership. For equities, an example of a popular and liquid asset, national and state legislation often has a large array of fiscal obligations that must be respected regarding capital gains. Taxes are charged by the state over the transactions, dividends and capital gains on the stock market. However, these fiscal obligations may vary from jurisdiction to jurisdiction.

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