What you pay on a £1,000,000 gain
A £1,000,000 gain is exactly the size at which the Business Asset Disposal Relief lifetime limit becomes the whole conversation — the limit is £1 million, once, across your lifetime. Whether the gain qualifies, and how much of the limit you have already used, is worth more than any other planning decision on this page.
At this level the £3,000 annual exempt amount is a rounding error — it removes 0% of the gain, leaving £997,000 chargeable. What matters is the rate. The chargeable gain sits on top of your taxable income, so the slice inside the £37,700 basic-rate band is charged at 18% and the remainder at 24%. Even on a £20,000 income the bill is £237,464, against £239,280 for a higher-rate taxpayer — a spread of only £1,816, because a gain this large overwhelms the band whatever your income. Reliefs, ownership and timing move the number here; your salary barely does.
CGT on £1,000,000 by your income
Income means your total income before tax for the year. The second column is the unused part of the £37,700 basic-rate band — the only slice of this gain that can be charged at 18%. Because the gain is large, the 24% column dominates every row, and the total moves by only £1,816 across the whole table.
| Your income | Basic band left | Gain at 18% | Gain at 24% | CGT | You keep |
|---|---|---|---|---|---|
| £20,000 | £30,270 | £30,270 | £966,730 | £237,464 | £762,536 |
| £30,000 | £20,270 | £20,270 | £976,730 | £238,064 | £761,936 |
| £40,000 | £10,270 | £10,270 | £986,730 | £238,664 | £761,336 |
| £45,000 | £5,270 | £5,270 | £991,730 | £238,964 | £761,036 |
| £50,000 | £270 | £270 | £996,730 | £239,264 | £760,736 |
| £60,000 or more | £0 | £0 | £997,000 | £239,280 | £760,720 |
2026/27 figures. Annual exempt amount £3,000; rates 18% and 24% for disposals on or after 6 April 2026 (GOV.UK); personal allowance £12,570; basic-rate band £37,700. Assumes the whole gain falls in one tax year with no losses or reliefs.
How the gain stacks on your income
Capital gains are taxed last, on top of income. On a gain this size the stacking is less about which rate applies — most of it lands at 24% regardless — and more about the exact point at which the 18% slice runs out. Worth seeing on real numbers, because it sets the floor for everything else on this page.
Worked through on a £20,000 income: the personal allowance covers £12,570, leaving £7,430 of taxable income, so £30,270 of the basic-rate band is unused. Take the £3,000 exempt amount off the gain and £997,000 is chargeable — £30,270 of it at 18% (£5,449) and £966,730 at 24% (£232,015), £237,464 in total. The effective rate across the whole gain is 23.7%, which is neither of the headline numbers.
Business assets, property and shares: one rate card
Since 30 October 2024 there has been a single pair of main rates — 18% and 24% — covering residential property, commercial property, shares, funds, crypto and business assets alike. Before that, non-property assets were charged at 10% and 20%; the main rates were raised to match residential property, which was left unchanged. Any guidance quoting 20% as the top rate predates the change, which matters when the gain is £1,000,000 and the difference is measured in tens of thousands.
What still varies by asset class is everything around the rate. UK residential property must be reported and paid within 60 days of completion and stays within the UK net even for non-residents. Business assets may qualify for Business Asset Disposal Relief at 18%. Shares run through the pooling and share matching rules, and a disposal of a company shareholding may be part cash, part deferred — each element with its own timing. On a gain this size the classification of the asset is worth professional advice before the sale, not after.
Why the £3,000 allowance barely registers
The annual exempt amount is £3,000 for 2026/27. Against a £1,000,000 gain it removes 0% and saves £720 — real money, but 0% of the bill. It was £12,300 as recently as 2022/23; the reduction hurts small investors far more than it does anyone disposing of an asset this size.
The allowance is worth knowing about here for one reason only: it is per person, and transfers between spouses and civil partners who live together are outside Capital Gains Tax entirely. Splitting ownership before a disposal brings a second £3,000 and, more importantly, a second unused basic-rate band. On a gain this size that second band is worth more than the allowance attached to it.
Business Asset Disposal Relief and the £1m limit
On a gain this size the relief is the single largest number available. It charges qualifying gains at 18% instead of the main rates, capped at a £1 million lifetime limit — not per disposal, per lifetime, counted across every claim since 11 March 2020. Applied here it takes the bill from £239,280 to £179,460, a saving of £59,820, and consumes £1,000,000 of the limit, leaving £0 for anything you sell later.
Qualification is decided by facts already in place before the sale: the disposal must be of a business or of shares in a personal trading company where you are an employee or officer, and the holding conditions must have been met for the required period beforehand. The rate is also a moving target — 10% up to 5 April 2025, 14% for 2025/26, 18% from 6 April 2026 — so a disposal pushed across a tax year boundary can change the answer. Anyone contemplating a disposal at this level should have the relief confirmed in writing by an accountant well before completion.
Deadlines, and finding £239,280
The deadline depends on the asset and it is unforgiving for property. A gain on UK residential property must be reported and paid within 60 days of completion — on this disposal, £239,280 due inside two months. Structure the sale so the tax is ring-fenced from the proceeds on day one rather than found later; interest and penalties apply from the deadline.
Other assets go through Self Assessment, or HMRC's real time service where you report by 31 December in the tax year after the gain and pay by 31 January. A disposal this size will normally sit alongside other reporting obligations, and the paperwork is only as good as the records: acquisition contracts, improvement invoices, professional fees and, where relief is claimed, the evidence that the qualifying conditions were met throughout. Reconstructing twenty years of cost base after completion is how gains get overstated.
What actually moves a £239,280 bill
Allowances are noise at this level; structure is not. Ownership: assets held jointly with a spouse or civil partner use two exempt amounts and two basic-rate bands, and transfers between partners who live together are outside the charge, so the split has to be real and in place before the disposal. Relief: if the disposal qualifies for Business Asset Disposal Relief the rate falls to 18% up to the £1 million lifetime limit — £59,820 here. Timing: splitting a disposal across tax years duplicates the allowance and can move part of the gain into a lower-income year.
Cost base and losses: acquisition costs, professional fees and capital improvements all reduce the gain, and unclaimed losses from earlier years can be brought forward — each £1,000 of loss is worth £240 at 24%, and the claim must be made within four years (claiming capital losses). Residence: for a genuine non-resident, gains on non-UK assets can fall outside the UK net entirely, though UK land and property never does and the temporary non-residence rules catch short absences — see capital gains tax when you leave the UK.
The £1 million lifetime limit, exactly
The limit and the gain are the same number, which makes the arithmetic unusually clean. If the whole £1,000,000 qualifies and none of the lifetime limit has been used, the exempt amount comes off and the balance is charged at 18%: £179,460, against £239,280 at the main rates. That is a £59,820 difference on a single decision, and it exhausts the limit — there is no second £1 million.
If half the limit has already gone on an earlier disposal, only £500,000 of this gain is relieved and the rest is charged at ordinary rates. The lifetime limit has been £1 million for disposals on or after 11 March 2020, having been £10 million before that, so anyone who claimed under the old regime should check what HMRC treats as already used. At this size the relief question is not a detail — it is the largest single number on the page.
Work out your own gain, costs and income
Capital gains tax calculator →Frequently asked questions
How much capital gains tax will I pay on a £1,000,000 gain?
A higher-rate taxpayer pays £239,280 in 2026/27: the £3,000 annual exempt amount comes off first, leaving £997,000 taxable, charged at 24%. A basic-rate taxpayer on a £20,000 income pays £237,464, because £30,270 of the gain still fits inside the unused basic-rate band at 18%. Your income decides the split.
Is the rate different for property and for shares?
No — not any more. Since 30 October 2024 the main rates for other chargeable assets rose from 10% and 20% to 18% and 24%, matching the residential property rates, which were left unchanged. For 2026/27 both are 18% and 24%. What still differs is the deadline: UK residential property must be reported and paid within 60 days of completion, while other gains go through Self Assessment or the real time service.
How does the gain interact with my salary?
The gain is stacked on top of your taxable income. Whatever is left of the £37,700 basic-rate band after your income is charged at 18%, and anything above it at 24%. On a £20,000 income, £30,270 of band is unused, so £30,270 of this gain is taxed at 18% and £966,730 at 24% — £237,464 in total, an effective 23.7% on the whole gain.
Can Business Asset Disposal Relief reduce this?
If the disposal qualifies, yes: BADR charges 18% for disposals on or after 6 April 2026, up to a £1 million lifetime limit. On £1,000,000 that is £179,460 instead of £239,280, a saving of £59,820. It applies to disposals of a business or of shares in a personal trading company, with conditions that must be met before the sale — check eligibility with an accountant in advance, not afterwards.