Company Capital Gains & Corporation Tax: Complete CT600 Guide
When your limited company sells an asset for more than it cost, the profit is a chargeable gain. Unlike individuals who pay Capital Gains Tax separately, companies pay Corporation Tax on their gains — reported directly on the CT600.
How Company Capital Gains Work
Companies don't have a separate CGT regime. Instead, chargeable gains are added to your trading profits and taxed at the standard Corporation Tax rate (19% or 25%, depending on your profit level).
What Counts as a Chargeable Asset?
- Property (offices, warehouses, land)
- Shares and securities in other companies
- Goodwill and intellectual property
- Plant and machinery (though most are covered by capital allowances)
- Domain names, patents, trademarks
What's Exempt?
- Cars — always exempt from chargeable gains
- Wasting assets with a predictable life under 50 years (unless used in a trade and attracted capital allowances)
Calculating the Gain
Sale proceeds
− Original cost (including purchase costs)
− Enhancement expenditure (improvements)
− Disposal costs (legal fees, agent fees)
= Chargeable gain (or allowable loss)
Indexation Allowance
Companies can claim indexation allowance to remove the inflationary element of a gain. This uses the Retail Prices Index (RPI) from the month of purchase to the month of sale (or December 2017, whichever is earlier — indexation was frozen from January 2018).
Important: Indexation allowance can reduce a gain to zero but cannot create or increase a loss.
Example
Your company bought a commercial property in March 2010 for £200,000 and sold it in January 2026 for £350,000:
| Item | Amount |
|---|---|
| Sale proceeds | £350,000 |
| Original cost | £200,000 |
| Indexation allowance (Mar 2010 to Dec 2017) | £32,600 |
| Chargeable gain | £117,400 |
This £117,400 is added to your trading profits on the CT600.
Substantial Shareholding Exemption (SSE)
If your company sells shares in another company and meets certain conditions, the gain may be completely exempt from Corporation Tax under the SSE:
- Your company held at least 10% of the ordinary share capital
- For a continuous 12-month period within the 6 years before sale
- The company being sold is a trading company (or holding company of a trading group)
This is one of the most valuable reliefs available — it can exempt gains of any size.
CT600 Boxes for Capital Gains
| Box | Description |
|---|---|
| Box 16 | Tick if chargeable gains are included |
| Box 275 | Gross chargeable gains (before losses) |
| Box 280 | Allowable losses (current period) |
| Box 285 | Net chargeable gains |
| Box 290 | Losses brought forward used against gains |
| Box 295 | Net chargeable gains after losses |
Losses
If you sell an asset at a loss:
- Current year losses are set against gains in the same period automatically
- Excess losses carry forward indefinitely against future gains
- Capital losses cannot be set against trading profits (they're ring-fenced)
Rollover Relief
If your company sells a qualifying business asset and reinvests the proceeds in a new qualifying asset within 12 months before to 36 months after the sale, you can defer the gain by claiming rollover relief.
Need to file a CT600 with capital gains? Start your filing on Taxpipe — £59, no hidden fees.