Business News - March
Last Chance To Discuss CGT Impact
That’s what Lincolnshire based accountants Moore Thompson are reminding their clients, with the April 2008 deadline getting nearer and nearer. As a result of Alistair Darling’s January announcement of the introduction of Entrepreneurs’ Relief, individuals’ situations may have changed yet again.
Small and Medium Sized Enterprises (SMEs) may benefit from the new relief, which was introduced by the Chancellor earlier this year, as a result of widespread outcries against the abolition of indexation relief and taper relief. Instead, from April 2008, Capital Gains will be taxed at a flat rate of 18%. However, individuals now have an allowance of £1m on which they will be taxed the lower rate of 10%.
The relief can be claimed on the disposal of part or all of a business, and also on the disposal of shares or assets by employees and directors who own at least 5% of the share capital and the voting rights. The relief is also applicable against the sale of assets of businesses sold within three years of the business ceasing to trade.
The relief is cumulative, which means that individuals can claim relief on gains up to the £1m limit throughout their lifetime before being required to pay the 18% CGT rate.
Mark Hildred comments: “The introduction of this relief has diminished some of the outrage felt towards the abolition of indexation and taper relief. However, CGT positions are all unique, so it is wise to seek advice about your assets, even if you aren’t planning to dispose of them now.
“Individuals that have already begun to make disposal arrangements may also benefit from advice, as the introduction of entrepreneur’s relief may change their position somewhat. They may now feel it more beneficial to hold on to their assets until a later date.”
For more information contact Moore Thompson on 01775 711333
