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Entrepreneurs Relief
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Entrepreneurs Relief
After the changes to the capital gains tax regime after April 2008 Entrepreneurs Relief is now the key tax reduction relief for many business owners. It can provide for an effective CGT rate of 10% for disposals of businesses, shares and also property in certain circumstances.
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Online Entrepreneurs Relief Tool |
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Articles on Entrepreneurs Relief include:
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Latest case on selling part of a business and Entrepreneurs Relief
23/12/2011
Ensuring that you qualify for Entrepreneurs Relief on a disposal of your business can reduce your CGT rate from 28% to 10%. Where you're not selling all of your business a crucial distinction is whether you are selling business assets or part of your business. Only in the latter case will you qualify for Entrepreneurs Relief. This article looks at a recent case covering this important point . . .
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Is there a limit the number of times I can claim Entrepreneurs Relief - USERNAME: Cashbuyer
Tax Question: A colleague has had it suggested to him by his accountant that after claiming ER three times, the percentage of relief available to an individual is reduced. I have not heard of this and had believed that providing the total ER claimed does not exceed the £10 million lifetime limit, ER can be claimed any number of times throughout an individual's life. For the purposes of clarity it can be assumed that all qualifying criteria will be met each time a disposal is made and ER is claimed. Other than the £10 million lifetime limit for Entrepreneur's Relief are there any other limits to take into consideration? In particular is there a limit to the number of times an individual can claim ER? Many thanks. . . .
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Payment of rent and Entrepreneurs Relief -
USERNAME: ChengWong
Tax Question: MR Chan has a property and has been trading as a sole trader for many years. In 2007, he incorporate his business as a limited company which he has 100% shares. The limited company pay him market rent. If he sell the property now, will he be entitle to entrepreneur relief ? . . .
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Structuring disposals free of capital gains tax whilst UK resident
07/11/2011
Individuals are subject to an 18% or 28% rate of capital gains tax when they sell assets. If they're selling a business or an interest in a business they can reduce the rate of CGT to 10%. But what about completely avoiding CGT? In this article we look at one strategy using a company and the substantial shareholding exemption to completely avoid capital gains tax . . .
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Entrepreneurs Relief for LLP members? -
USERNAME: commodity4
Tax Question: I'm a partner in an LLP that owns the IP rights to some software we developed. We have a buyer who wants purchase the IP and following the sale we plan to wind up the LLP. We're trying to establish whether we can claim Entrepreneur's Relief as the IP was developed over a year ago. . . .
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Entrepreneurs Relief and spouses - USERNAME: Cheng
Tax Question: Business and property bought in joint names. Husband trade as a sole trader for a few years then ceased trading and wife ran the business as a sole trader for a few years. Wife ceased trading and husband ran the business as a sole trader for 3 months and sold the business. Can they claim entrepreneurs' relief ? or any Extra statutory concession . . .
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Entrepreneurs Relief and deferred consideration - USERNAME: The Protector
Tax Question: I have a client company looking to sell their company - 2 directors/shareholders. The proposed deal includes upfront cash and unascertainable future deferred consideration (formula based on future profits). Clients are obviously anxious to maximise Entrepreneurs Relief (ER). I know following changes in the 2nd FA 2010 it is no longer possible to claim ER on deferred consideration. So what is the best way to secure ER? . . .
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Entrepreneurs Relief and the 5% requirement - USERNAME: robertp
Tax Question: I qualify for entrepreneurs relief having just over 5% of the shares of a trading company (and meeting the other conditions) and I intend to sell all my shares. If I want to sell my shares in two separate transactions, how do I ensure that they both qualify for entrepreneurs relief, as either transaction would take my holding below 5%? If both transactions take place on the same day (effectively simultaneously) does that avoid the problem? I have some share options which I can now exercise. Do I have to hold them for 12 months from exercising them for them to be eligible for entrepreneurs relief on disposal? Thanks . . .
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Entrepreneurs relief for non doms and the remittance basis
22/06/2011
Making the most of this generous tax relief can reduce your rate of CGT to just 10%. It can apply to non UK domiciliaries selling overseas businesses or shares in overseas trading companies. This article looks at how Entrepreneurs Relief applies to non domiciliaries whether they are taxed on the arising basis or the remittance basis. . . .
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Entrepreneurs Relief for non dom on remittance basis - USERNAME: derbynut
Tax Question: If a non dom individual makes an offshore gain and claims the remittance basis for the year in question, they will not be taxable on the gain until it is remitted to the UK. If the gain qualifies for entrepreneurs relief at the time of disposal, based on current legislation, would they be able to achieve the 10% rate on a future remittance? (I assume they would need to make a claim within the relevant time limits based on the disposal date). They could evidently achieve the 10% tax rate if they chose to be taxed on the arising basis. If entrepreneurs relief is available, and the gain was say £15m, only the first £10m would qualify for relief. Assuming there are no mixed account issues, would the non dom be able to bring the gain back to the UK in the most beneficial way, ie at the 10% rate first? . . .
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Using growth shares to qualify for Entrepreneurs Relief
02/03/2011
Entrepreneurs Relief can save you CGT of up to £900,000. However the conditions to qualify for this generous relief can be onerous. In particular you need to hold at least 5% of the ordinary share capital and voting rights. In this article we look at how growth shares can be used to sidestep this requirement . . .
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How to qualify for Entrepreneurs Relief on your investment property
29/11/2010
If you qualify for Entrepreneurs Relief you'll pay CGT at just 10% on gains up to £5 Million. Entrepreneurs' relief is not usually available when you sell investment properties but it may be available when you sell properties used in a trading business. In this article we look at how you can arrange for your investment property to qualify for Entrepreneurs Relief . . .
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When to opt for an asset or share deal after the CGT changes from 23 June 2010
23/07/2010
When you're selling your company, there are two broad options. You could either structure the deal as a share deal or an asset deal. If you sell the shares, then the capital gain will arise on you (ie 10%, 18% or 28%). If you opt for an asset deal the company doesn't pay capital gains tax (which would only usually apply to individuals, trusts and executors). Instead it pays corporation tax on any capital gains. The tax rate will be its marginal rate of tax. In this article we look at precisely when it is attractive in tax terms to opt for a share or asset deal . . .
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