With the benefit of entrepreneurs’ relief the tax payable on the disposal of trading businesses can be reduced to just 10% rather than 28%. Such disposals include the sale of shares in a trading company, the sale of a sole trade business or a share in a partnership.
Currently entrepreneurs’ relief can be claimed on the first £10 million of capital gains made in your lifetime.
There have been rumours that the Government are starting to feel that the entrepreneurs’ relief regime is a little too generous. Could this be another area for change?
Capital gains tax is not traditionally thought of as one of the higher revenue raisers, but there has been some commentary about the amount of tax saved by this relief.
Our view is that any changes made will limit the relief rather than remove it completely. Entrepreneurs’ relief succeeded business asset taper relief which also reduced the tax payable on the sale of qualifying businesses. Hence we are unlikely to be left with no relief for business sales and drafting a whole new relief for business sales at this time does not seem to fit.
It is difficult to offer planning suggestions without further details, those who are already in the process of a sale and are aiming for completion imminently should speak to their tax advisor.
If you would like to discuss entrepreneurs’ relief, please contact Lesley Sutton on 01484 550 037 or email firstname.lastname@example.org