Capital Gains Tax for business
Tax relief
You may be able to reduce or delay the amount of Capital Gains Tax you have to pay if you’re eligible for tax relief.
| Relief | Description | Eligibility |
|---|---|---|
| Business Asset Disposal Relief | Pay 10% Capital Gains Tax on qualifying profits if you sell all or part of your business (instead of the normal rates) | For sole traders, business partners or those with shares in a ‘personal company’ |
| Business Asset Rollover Relief | Delay paying Capital Gains Tax when you sell or dispose of some types of asset if you replace them | Buy the new asset within 3 years of disposing of the old one. Use the old and new assets in your business |
| Incorporation Relief | Delay paying Capital Gains Tax when you transfer your business to a company | Transfer all your business and its assets (except cash) in return for shares in the company |
| Gift Hold-Over Relief | Pay no Capital Gains Tax if you give away a business asset - the person you gave it to pays tax when they sell it | You used the business asset for trading as a sole trader or partner |
Tax relief when you sell your home
You normally get Private Residence Relief when you sell or dispose of your main home, meaning you do not pay any Capital Gains Tax.
If you’ve used any part of your home just for business, you have to pay Capital Gains Tax on that part when you sell your home.
Disincorporation relief
You may be able to claim Disincorporation Relief if you become a partnership or sole trader having been a limited company.
If you acquire the company’s assets when it changes its business structure, you may have to pay Capital Gains Tax if you sell or dispose of them later - you’ll use their value, including any Disincorporation Relief, when you acquired them.
You can get help from an accountant or tax adviser.