December 2024 saw a dramatic increase in CGT, with a total of £335 million in tax receipts – which was £176 million more than the £159 million collected in December 2023.

Over the last quarter, CGT hit £808 million, an increase of 60 per cent from last year’s £505 million for the same quarter.

Tax receipts in total also increased, rising to £607.3 billion between April and December – a £19.4 billion rise compared to 2023.

Over £70.1 billion in tax was taken in December – an increase of £5 billion from 2023, but a huge £46.4 billion rise from December 2019. This demonstrates a record tax burden and the effect of fiscal drag.

Inheritance tax (IHT) has also seen a dramatic rise, hitting £620 million in December 2024. So far this tax year, £6.3 billion has been paid in IHT, up nearly 10 per cent on 2023, an increase of £600 million.

An effective strategy to mitigate the significant impact of potential IHT and CGT increases, which could combine to a tax rate of 68 per cent for some individuals, is to make regular gifts from surplus income.

By gifting leftover income at the end of each month, individuals can transfer wealth to their loved ones without incurring Inheritance Tax, effectively reducing their tax liability.

Wondering what this means for you and your wealth? Get in touch with our team for tailored support and guidance.