The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:
Business asset disposal relief (previously known as entrepreneurs’ relief) is a capital gains tax (CGT) relief that allows business owners with chargeable gains on qualifying business assets to pay CGT at a rate of 10%. For disposals made on or after 11 March 2020, the relief is available on up to £1m of capital gains for each individual over their lifetime; prior to 11 March 2020, the lifetime limit was £10m. This reduction in the lifetime limit was in FA 2020 and is detailed further below. Relief is available on gains arising to sole traders, partners, shareholders and trusts. It applies to all disposals, so includes gifts and non-arm’s-length sales. It is also possible to create a deemed disposal for business asset disposal relief in certain circumstances.
For an individual to claim business asset disposal relief, there must be a:
‘material disposal of business assets’
‘disposal of trust business assets’, or
‘disposal associated with a relevant material disposal’
TCGA 1992, s 169H(2)
Whilst the three types of qualifying disposal for business asset disposal relief all refer to disposals of business assets, the qualifying assets are different in each case. It is important from the beginning to categorise what type of disposal has been made and focus on the criteria for each.
Where the criteria for each disposal type are not met, business asset disposal relief cannot be claimed. A disposal of business assets is, in itself, not sufficient.
Where a qualifying business disposal is not of shares in or securities of a company (ie disposals by sole traders and partners, disposals of trust business assets, and associated disposals), business asset disposal relief is given only in respect of the disposal of relevant business assets comprised in the qualifying business disposal. Relevant business assets are generally assets used for the business which are not shares, securities or any other assets held as investments.
A material disposal may also occur without a disposal of shares. This
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
IntroductionSubsistence is the amount incurred as a consequence of business travel. Typically it relates to accommodation and meal costs incurred. These amounts are allowed because they are associated with the necessary travel. See the Travel expenses guidance note for more information of when
IntroductionUK tax must be withheld on UK payments including:•interest•royalties•rental incomeWithholding tax may be reduced under double tax treaties (DTT) or European directives, both of which may be subject to making a formal claim.This guidance note outlines the rules for UK withholding tax, and
The basic rule is that all benefits provided to an employee by reason of their employment are taxable unless there is a specific exemption or other rule that means they are not chargeable to tax.ExemptionsThe main exemptions for employee benefits are in ITEPA 2003, ss 227–326B (Pt 4).Below is an
What is structures and buildings allowance (SBA)?From 29 October 2018, expenditure on constructing a non-residential building or structure, or in certain cases, expenditure on acquiring such a building or structure, qualifies for an SBA. The following note has been updated for the changes announced
To view our latest tax guidance content, sign in to Tolley Guidance or register for a free trial.