Taxation of trusts—CGT reliefs for business assets
Produced in partnership with Stewart Jordan and Alexander Massey
Taxation of trusts—CGT reliefs for business assets

The following Private Client guidance note Produced in partnership with Stewart Jordan and Alexander Massey provides comprehensive and up to date legal information covering:

  • Taxation of trusts—CGT reliefs for business assets
  • Business asset roll-over relief
  • Incorporation relief
  • Enterprise investment scheme and seed enterprise investment scheme
  • CGT relief on company reorganisations
  • Relief for losses on loans to traders

FORTHCOMING CHANGE: As originally announced at Autumn Budget 2017 and followed up by written statement after Spring Statement 2018, plus an announcement in Budget 2018, the government ran a consultation on the taxation of trusts from 7 November 2018 to 28 February 2019, inviting views on the principles of transparency, fairness and simplicity that it believes should underpin the taxation of trusts. In response, in July 2019, the Office of Tax Simplification issued its second report on inheritance tax. See also the report published by the All-Party Parliamentary Group for Inheritance & Intergenerational Fairness in January 2020 recommending the adoption of a new inheritance tax regime. See also the research exploring the use of trusts which was also published on 7 November 2018. See News Analysis: Exploring the consultation and review on the taxation of trusts.

The purpose of this Practice Note is to set out an overview of the key capital gains tax (CGT) reliefs and exemptions applicable to business assets which are available to trustees (as well as individual business owners).

This Practice Note examines:

  1. CGT reliefs for trustees carrying on a business, namely:

    1. business asset roll-over relief

    2. incorporation relief

  2. CGT reliefs and incentives for trustees as investors, namely:

    1. enterprise investment scheme (EIS) and seed enterprise investment scheme (SEIS)

    2. relief on company reorganisations

    3. relief for losses on loans to traders

EIS