Estimate tax on stocks, property and crypto. Short vs long-term US and UK rates with net profit calculation.
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728x90 · Finance placement · Est. CPM $20-$48
Part of a topic cluster
This page is part of our Complete Tax Guide 2026 — a complete guide covering every aspect of this topic.
Tax owed
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Capital gain
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Tax rate applied
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Net profit after tax
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336x280 · Finance/Insurance · Est. CPM $22-$48
How capital gains tax is calculated
Capital gains tax applies to the profit from selling an asset. The rate depends on how long you held the asset and your total income for the year.
US 2026: Short-term gains (held <1 year) are taxed as ordinary income (10%–37%). Long-term gains (held >1 year) are taxed at 0%, 15%, or 20% depending on total income. UK 2026: CGT annual exempt amount is £3,000. Gains above this are taxed at 18% (basic rate) or 28% (higher rate) for residential property; 10%/20% for other assets.
Worked example with real numbers
US investor | Bought shares for $28,000 | Sold for $55,000 | Held 18 months | Annual income: $90,000
Step
Calculation
Amount
Gross gain
$55,000 − $28,000
$27,000
Holding period
18 months
Long-term
Total income bracket
$90,000
15% long-term rate
Capital gains tax
$27,000 × 15%
$4,050
Net profit after tax
$27,000 − $4,050
$22,950
If held for only 8 months instead: gain taxed as income at 22% → $5,940 tax → $900 more paid for holding 10 fewer months.
Common mistakes to avoid
Forgetting the holding period by even one day. Selling on day 364 vs day 366 can shift a gain from ordinary income rates (up to 37%) to long-term rates (15%–20%). The difference on $27,000 gain at 22% vs 15% is $1,890.
Ignoring cost basis adjustments. If you received dividends that were reinvested, those reinvestments increase your cost basis and reduce your taxable gain. Track every reinvestment.
Not harvesting losses. Up to $3,000 of net capital losses can offset ordinary income annually (US). Losses above that carry forward indefinitely. Selling losing positions before year-end to offset gains is one of the most reliable tax optimisation strategies.
Assuming all investment accounts have the same tax treatment. Gains inside a Roth IRA or ISA are tax-free. Gains in a taxable brokerage account are fully subject to CGT. Asset location — putting higher-growth assets in tax-advantaged accounts — can save significantly.
Not accounting for state CGT. California taxes long-term capital gains as ordinary income (up to 13.3%). The calculator uses a federal-only estimate — add your state rate for full accuracy.