HMRC have recently conducted research into Entrepreneurs relief to see whether it acts as a motivating factor in business decisions.
Entrepreneurs relief (ER) applies to individuals who sell qualifying business assets, reducing the rate of capital gains tax to 10%.
Typically claims are made on the sale of trading company shares, personally held property used by a business and furnished holiday lets.
The results showed that of those aged over 65 were most likely to pay the full rate of capital gains tax without taking advice. The research identified a massive 44% of those surveyed as being potentially able to claim ER.
A younger group (a third of whom were aged less than 45) had the lowest awareness of ER despite 65% of them being self-employed.
Remember that ER can significantly reduce the tax you pay when you sell your business or related assets, so it is always worth taking tax advice. Depending on the type of asset being sold the maximum rate of capital gains tax without ER is 28%, compared to only 10% with ER.
For more information, please contact Lesley Sutton on 01484 550037 or email firstname.lastname@example.org.