Tax law can be very complex
Capital Gains Tax (CGT) is a levy of 18% which may need to be paid when you sell certain assets, including property, shares or other investments such as antiques, art and cars.
Typically, a capital gain is generated when the asset or investment is sold, but it can also occur when a gift is given or even when a competition prize is won.
The proceeds from selling a house are normally liable if it was a rental investment or a second home.
However you won't pay CGT on the gain from some assets, such as personal possessions worth £6,000 or less, and in most cases, your main home.
In addition every individual has a personal CGT-free allowance, currently amounting to £9,600 for the 2008-09 tax year.
Both companies and individuals must pay CGT, but there are different rules and exemptions for each.
Essentially, CGT is charged on the proceeds of a sale, or the market value of a gift, less its original cost, and after any selling and improvement expenses have been taken into account.
CGT raised £5.3bn in 2007-08, far less than income tax, VAT or corporation tax.
It is unlikely to be abolished, as it would open up a huge tax avoidance loophole which would allow individuals and corporations to convert income into capital.
In other words, taxpayers might be tempted to turn down a salary in favour or gifts or company shares which they could sell on to raise money tax-free.
But such an objection does not prevent business organisations from regularly lobbying the government to abolish CGT in key areas in a bid to stimulate investment and give additional incentives to talented staff.
Their persistence paid off when the Chancellor confirmed a CGT exemption for companies disposing of substantial shareholdings in their main business or in their subsidiaries.
Under the changes, which should encourage companies to restructure quickly and flexibly in response to new opportunities, the disposal of stakes of 10% or more in trading companies will not be taxable.
This means that companies wishing to restructure for commercial reasons will be able to do so without being constrained by CGT.
The changes are forecast to reduce the tax burden on business by £150m a year.
What is CGT exempt?
Your private car
Jewellery, paintings and antiques worth less than £6,000
Savings Certificates and Premium Bonds
Betting, lottery or pools winnings
The Chancellor has also eased CGT on the sale of other stocks in recent years in a bid to encourage employee share ownership and tempt talented managers to join fast-growing businesses.
Enterprise Investment Scheme reinvestment relief allows CGT to be deferred when the proceeds of a sale are used to buy shares in certain small unquoted companies.
Inheritance tax (IHT) has affected a growing number of people in the UK - mainly because IHT thresholds have not risen in line with house prices.
This tax raised £3.1bn for the Revenue in 2007-09.
Inheritance tax is a form of death duty and without some sound tax planning in advance you can saddle your nearest and dearest with a large bill to pay.
You will avoid it altogether on money or assets inherited from a spouse or civil partner, on gifts made to UK charities, or on cash or gifts which are made at least seven years before death.
In addition there is an annual exemption which means you can give up to £3,000 away each year, either as a single gift or as several gifts adding up to that amount.
And small gifts of up to £250 can be given to as many people as you like tax-free.
Give away your money at least seven years before you die
Set up a discretionary trust
When you die the tax is paid by the executors of your estate, the people who manage your will after your death, from your remaining assets.
The value of estates above the tax threshold (currently £312,000 for the tax year 2008 to 2009) is taxed at 40%.
When property prices rise strongly more people find their estates targeted by IHT - because the £312,000 threshold includes the value of your house - unless it is left to a UK-domiciled spouse or civil partner.
However a very significant change to inheritance tax was introduced in October 2007.
This means that married couples, and registered civil partners, can effectively inherit the unused IHT tax allowance of their deceased partner.
Thus when the second partner dies, the IHT allowance that applies to their estate can effectively be doubled, currently to £624,000 in 2008-09.
The executors of the first to die must transfer their unused IHT allowance, or 'nil rate band' as it is called, to the second spouse or civil partner.