Business Asset Disposal relief (formerly Entrepreneurs’ Relief)

Entrepreneurs’ relief was renamed Business Asset Disposal (BAD) relief for the 2020/21 tax year onwards.

Business Asset Disposal relief can allow you to pay a lower rate of capital gains tax (CGT) when you sell your business. If BAD relief applies, the rate of CGT is reduced to 10%. Individuals have a lifetime limit of £1 million of gains for which Entrepreneurs’ relief can be claimed.

It is vital, for BAD relief to apply, that the qualifying conditions are met. Given the substantial tax savings involved, it is vital that you organise your business and its sale so that you qualify for BAD relief.

It’s easy to assume that you are entitled to Entrepreneurs’ relief (now BAD relief). However there are sometimes issues that can throw this assumption into doubt and it can be a very costly if you happen to get a different tax treatment. Nine times out of ten there are no issues but you have to make sure that you’re not the one in ten.

At Wilson Partners, our tax team spends a lot of our time advising clients on their eligibility for BAD relief as well as planning ahead to ensure that the conditions are met where they can be. We’ve supported clients in Maidenhead, Reading, London and Slough.

If you’re looking to sell your business talk to us today to make sure you don’t get taxed unnecessarily.