Commentary

245 Capital gains tax implications for the seller

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

245 Capital gains tax implications for the seller

| Commentary

245 Capital gains tax implications for the seller

Any business sale is likely to involve the transfer of chargeable assets to the company with the consequent risk of capital gains tax. The availability of entrepreneur’s relief to reduce the value of the chargeable gain in this situation has already been discussed1 as has the possibility of deferring the tax liability by claiming roll-over relief2.

On the incorporation of an existing business, there is an extra roll-over relief which applies in relation to the potential capital gains tax liability3. This relief, sometimes referred to as ‘incorporation relief’, operates to roll over any

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