Capital gains tax: New Entrepreneurs Relief: Relief on Disposal of a Business - May 2008
Individuals and trustees who dispose of the whole or part of a trading business, or of shares in a trading company in which they have a qualifying interest, may be eligible to claim relief against a possible Capital Gains Tax liability.
New legislation is to be implemented this year which may mean that Entrepreneurs Relief may be available in respect of gains made by individuals on the disposal of:-
- All or part of a trading business, the individual carries on alone or in partnership
- Assets of the individual's or partnership's trading business following the cessation of the business
- Shares in the individual's "personal" trading company
- Assets owned by the individual and used by his/her "personal" trading company or trading partnership. There seems to be some concern that charging a rent may jeopardise a potential claim to entrepreneurs relief. Once legislation has been approved, clarification on this matter can be established
The first £1million of gains that qualify for relief will be charged to Capital Gains Tax at an effective rate of 10%.
Gains in excess of £1million will be charged to Capital Gains Tax at the rate of 18%.
This relief may apply to any gains qualifying after 6th April 2008.
There is no minimum age limit for Entrepreneurs Relief.
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