Glossary · UK
What is Bed and Spouse?
A CGT planning technique where one spouse sells an asset to crystallise a gain or loss and the other repurchases it at market value, effectively doubling the use of CGT annual exempt amounts.
Full Definition
Bed and spouse is a Capital Gains Tax (CGT) planning strategy used by married couples and civil partners to make efficient use of both partners' CGT annual exempt amounts (£3,000 each in 2026/27). The strategy works as follows: one spouse sells an asset (such as shares or a fund) standing at a gain or loss, crystallising that gain or loss and using their own annual exempt amount. The other spouse then repurchases the same asset using their own money (at its current market value), establishing a new and higher base cost in their name. The couple therefore ends up with the same economic exposure but with the asset rebased to its current market value and held in whichever partner's name is most tax-efficient for future disposals. This approach avoids the "30-day rule" (also known as the bed and breakfasting rule) that applies to an individual who sells and repurchases the same asset within 30 days -- because the purchase is made by a different person (the spouse), the 30-day matching rule does not apply. Transfers of assets between spouses and civil partners are themselves exempt from CGT (treated as "no gain/no loss"). Bed and spouse is a well-established and entirely legal strategy recognised by HMRC, unlike schemes targeted by disguised remuneration or DOTAS rules. It is particularly valuable at tax year end when annual exempt amounts would otherwise be wasted.