Gift relief for business assets ― restrictions

Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance

Gift relief for business assets ― restrictions

Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance
imgtext

In certain situations, gift relief is available to defer capital gains on gifts of business assets which would otherwise be immediately chargeable to capital gains tax (CGT).

This guidance covers restrictions on gift relief where a transferor gives away shares of a company holding non-business assets or where only part of an asset or holding period was used for business purposes.

For an introduction to gift relief for business assets, including the definition of business assets, and information about making claims and the possibility of paying tax in instalments, see the Gift relief for business assets guidance note.

Restriction for non-business assets in a company

Gift relief may not always completely eliminate the capital gain as sometimes gift relief is restricted. The most common example is where a transferor gives away shares in their personal company, and that company holds non-business assets.

If this is the case, the amount of the gain which qualifies for gift relief is restricted by the following fraction:

Gain eligible for gift relief = CBA/CA x gain

Where:

Continue reading the full document
To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™
Powered by Tolley+

Popular Articles

Payment of the remittance basis charge

Payment of the remittance basis chargeRemittance basis chargeThe remittance basis charge is an annual charge payable by ‘long-term’ UK residents for the privilege of claiming the remittance basis.Taxpayers who wish to utilise the remittance basis (but do not qualify for it automatically) must pay

14 Jul 2020 12:52 | Produced by Tolley Read more Read more

Real estate investment trusts (REITs)

Real estate investment trusts (REITs)Introduction to REITsA real estate investment trust (REIT) is in fact not a trust at all, it is a company which qualifies for special tax treatment under CTA 2010, Part 12. REITs are similar in many ways to collective fund vehicles (such as unit trusts) in that

14 Jul 2020 13:04 | Produced by Tolley in association with Rob Durrant-Walker of Crane Dale Tax, part of AMS Group Read more Read more

Loans written off

Loans written offCompanies sometimes provide directors, employees or shareholders with low interest or interest-free loans either as part of the reward package or on special occasions to help the individual meet significant expenditure. The employment income implications of these loans are discussed

14 Jul 2020 12:11 | Produced by Tolley Read more Read more