This Order may be cited as the Taxation of Chargeable Gains (Gilt-edged Securities) Order 2025.
The Treasury specified fourteen gilt-edged securities as exempt from capital gains tax.
The Taxation of Chargeable Gains (Gilt-edged Securities) Order 2025, issued by the Treasury, specifies fourteen gilt-edged securities as exempt from capital gains tax under the Taxation of Chargeable Gains Act 1992.
This action simplifies tax administration and supports efficient government borrowing by providing certainty for investors.
Arguments For
Facilitates efficient government borrowing: By clearly defining which securities are exempt from capital gains tax, the order supports the government's ability to borrow money at favorable rates. This is because it provides certainty to investors regarding the tax treatment of their investments.
Reduces administrative burden: The clear specification of exempt securities simplifies tax administration for both taxpayers and the tax authorities. Streamlined processes potentially lower compliance costs for individuals and businesses.
Legal basis in existing legislation: The order operates under the existing powers granted by the Taxation of Chargeable Gains Act 1992 and the National Loans Act 1968. This ensures consistency with established legal frameworks.
Arguments Against
Limited scope of exemptions: The order only specifies a limited number of securities, potentially leaving out other similar investments that might also merit exemption. This may create an uneven playing field for investors.
Potential for unintended consequences: While intended to clarify tax treatment, the order's specificity might create unforeseen complexities or loopholes in the tax code. This could inadvertently benefit some investors while disadvantaging others.
Lack of broader review: An ongoing assessment of whether these exemptions continue to make sense in the current context of UK tax policy is not explicitly included.
Citation1.
This section provides the official title for the legal document.
The order will be referred to as the Taxation of Chargeable Gains (Gilt-edged Securities) Order 2025 in official contexts.
Securities specified as gilt-edged securities2.
For the purposes of the Taxation of Chargeable Gains Act 1992 the following securities are specified as “gilt-edged securities”—
4½% Treasury Gilt 2028
0¾% Index-linked Treasury Gilt 2033
4⅝% Treasury Gilt 2034
4¾% Treasury Gilt 2043
3¾% Treasury Gilt 2027
4⅜% Treasury Gilt 2054
4% Treasury Gilt 2031
1¼% Index-linked Treasury Gilt 2054
4⅛% Treasury Gilt 2029
4¼% Treasury Gilt 2034
4⅜% Treasury Gilt 2040
4⅜% Treasury Gilt 2028
4⅜% Treasury Gilt 2030
1⅛% Index-linked Treasury Gilt 2035.
This section lists fourteen specific securities officially designated as 'gilt-edged securities' under the Taxation of Chargeable Gains Act 1992.
This designation is crucial for determining their tax treatment.
Explanatory Note
(This note is not part of the Order)
Section 115 of the Taxation of Chargeable Gains Act 1992 (c. 12) provides that gains on the disposal of “gilt-edged securities” are not chargeable gains. They are not therefore subject to capital gains tax (or, for companies, corporation tax). Paragraph 1 of Schedule 9 to the Taxation of Chargeable Gains Act 1992 provides that “gilt-edged securities” are those securities specified in Part II of Schedule 9 and such stocks and bonds issued under section 12 of the National Loans Act 1968 (c. 13) denominated in sterling and issued after 15th April 1969, as may be specified by order made by the Treasury. In exercise of that power this Order specifies fourteen securities as “gilt-edged securities”.
A complete list of gilt-edged securities which are exempt from capital gains tax may be found online at www.gov.uk/guidance/gilt-edged-securities-exempt-from-capital-gains-tax or obtained by writing to Assets, Residence and Valuation Policy, HMRC, 3C/03, 100 Parliament Street, London, SW1A 2BQ.
A Tax Information and Impact Note has not been prepared for this instrument as it contains no substantive changes to policy.
The explanatory note clarifies the legal basis for the order, referencing Section 115 of the Taxation of Chargeable Gains Act 1992, which exempts gains from gilt-edged securities from capital gains tax.
It also explains how the current order uses the power granted under Schedule 9 of that act and Section 12 of the National Loans Act 1968.
The note further points readers to a complete online list of exempt securities and asserts that no additional tax impact assessment was necessary due to the lack of policy changes.
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