When you sell or transfer all or part of your business you might be entitled to claim entrepreneurs’ relief in respect of any capital gain you make. This means that the maximum rate of tax that will apply will be 10%. However, to qualify there are conditions that you and your business must meet.
WHEN IS RELIEF AVAILABLE?
Entrepreneurs’ relief (ER) is available for qualifying business disposals. The relief imposes a lower rate of capital
gains tax (10%) than the top standard rate of 18% and is subject to a lifetime limit of £10 million of gains. The
relief applies to disposals of a business, but can also apply to disposals of assets which are associated with your
withdrawal from a business. For example, if you own a building that your partnership uses, and you leave the
partnership, ER might apply if you sold the building to the other partners.
ER is only available where there is a qualifying disposal of business assets, which includes selling all (or a part, if that part can operate as a business in its own right) of them or selling shares in your personal company. While it sounds simple, several traps in the legislation can mean ER won’t apply. The 2018 Budget tightened the rules up even further. Use our checklist ahead of a disposal. It won’t guarantee you ER, but it can help you avoid missing out for want of taking a few simple steps. To get the checklist Contact us. .
ALL THIS AND MORE
We offer all the above as part of our full Tax Services and Accounting and can also help you with Capital Gains Tax, Inheritance Tax, Retirement Planning, even filling out your Self-Assessment Tax Returns for you.