Commentary

244 Income tax implications for the seller

BUSINESSES vol 4(2) start-up, sale and purchase
| Commentary

244 Income tax implications for the seller

| Commentary

2: TAX IMPLICATIONS

244 Income tax implications for the seller

The basic tax implications of the discontinuance of a sole trade or partnership have already been considered, including the closing-year rules1, the possibility of a balancing charge in relation to capital allowances2 and the availability of loss relief3. As discussed previously, where the business has suffered a loss in the last 12 months of trading, this may be relieved by setting it off against the business profits of the three years of assessment preceding the year of the discontinuance brought about by the sale of the business4.

Where a sole trader or

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