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Entrepreneur's relief has had some significant changes since it was first introduced, the latest being in this year's Budget, soon to be enacted in the Finance Act. It is also being re-named Business Asset Disposal Relief (BADR). The rules on what and who qualifies remain the same apart from some provisions to prevent forestalling the reduction in limit.

The main change is to reduce the lifetime limit for qualifying gains to £1m from £10m. This may not affect a lot of people who have been running a small business which they are selling on retirement. It is most likely to impact on owners of larger businesses, farmers with valuable land or serial entrepreneurs who sell one business and start another. HMRC estimate that 80% of those using the relief will be unaffected.

The Government's stated purpose of this, according to its Budget documents, was to improve the effectiveness and value for money of the relief. The Government also claimed it would encourage genuine risk takers and entrepreneurs in a fair way.

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  1. Rosemary M
    Posted 25-Sep-2020 at
    only 20% of entrepreneurs will be effected. I wonder how much revenue this will generate for the government
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  2. Manish B
    Posted 16-Sep-2020 at
    Govt. by this target big company owners and wealthy individual.
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  3. Hasmita P
    Posted 14-Sep-2020 at
    Will affect larger companies the most
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  4. Tabarak H
    Posted 06-Sep-2020 at
    The relief will effect mostly larger companies.
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  5. Mohan L
    Posted 16-Aug-2020 at
    will impact those mainly those who are wealthy individuals to either have large assets of land or create new businesses often.
    0
  6. Julian L
    Posted 08-Aug-2020 at
    The reduction in the lifetime limit to £1m will hit in the main wealthy entrepreneurs and not the majority of individuals disposing of a business. The CGT tax rates are currently relatively benign even if BADR does not reduce the taxable gain to 10%.
    0
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