Capital gains tax

You will have to pay capital gains tax (CGT) on any increase in value of an asset that you sell. Typical assets might be stocks and shares, fine art, property (though not your primary residence), wine, antiques, business assets and so on. The tax is paid only on the gain in value since you acquired it, not on the total sale price.

If you pay basic rate income tax, then you'll pay CGT at 10 per cent. If you pay higher rate income tax, you'll pay CGT at 20 per cent. However, be aware that the gain itself might push you temporarily into the higher rate band – your financial adviser can help you work out if this is the case.

You must only pay CGT if your gain exceeds your annual tax-free exemption, which is £11,100 for the 2016/17 tax year. Remember that every individual has this allowance, so if you are in a couple then you can potentially save more by using both your allowances.

Some assets are exempt from CGT. These include your primary residence, personal possessions with a value up to £6,000, and any betting or lottery winnings. A financial adviser can help you reduce the amount of CGT you have to pay, such as by offsetting losses against future gains. This is a complex area where advice can make a big difference.

You can find a financial adviser in your local area here.