Business Relief (1) Flashcards
What can individuals claim business relief?
When they dispose of the whole of a business or has a significant part of a business
What does the relief cover?
First £1 million of chargeable gains on disposal
What is the disposal on the relief cover?
Whole or part of a business
Relief is only available in respect of gains on disposal of business assets
DIsposal of shares in a trading company where individual has 5% shareholding and an employee
Where are there no restrictions?
If company hold non-trading assets like investments
Where the business relief can be ap[plied
F - 5% shareholding
T - Trading company
T - Two year ownership before disposal
W - Work there
How are gains on assets qualifying for business asset disposal relief taxed?
At 10% regardless of an individual’s taxable income
How should losses and annual exempt amount be treated?
Initially be deducted from gains that don’t qualify for the relief
Most beneficial order for operation of relief/
Residential property gains
Other gains not qualifying for business asset disposal relief
Business asset disposal relief gains
What do gains qualifying for busienss asset disposal relief reduce?
Amount of any unused basic rate band despite being taxed at a rate of 10%
Is an individual business asset disposal relief automatic?
No
Lifetime limit for successive disposals?
£1 million
Where investors’ relief is available?
On disposal of shares in an unlisted trading company
What allowance is available on investor’s relief?
A separate £10 million lifetime allowance
What is gain on disposal of shares taxed in investor’s relief?
At 10%
When must shares have been issued durect to the taxpayer in investor’s relief?
On or after 17 March 2016 and held continuously for at least three years
