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Conditions for business asset disposal relief


Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance
tag-icon Autumn Budget 2024 tag-icon Tax Returns

Conditions for business asset disposal relief


Produced by a Tolley Owner-Managed Businesses expert
Owner-Managed Businesses
Guidance
tag-icon Autumn Budget 2024 tag-icon Tax Returns
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Business asset disposal relief (BADR) is a capital gains tax (CGT) relief that allows business owners with chargeable gains on qualifying business assets to pay CGT at a rate of 10%. The relief is available on up to £1m of capital gains for each individual over their lifetime. The lifetime limit has reduced several times and the previous limits are detailed further below.

At the Autumn Budget 2024 it was announced that the rate of BADR will increase to 14% for disposals made on or after 6 April 2025, and from 14% to 18% for disposals made on or after 6 April 2026, see more details below including anti-forestalling rules which apply from 30 October 2024.  

Relief is available on gains arising to sole traders, partners, shareholders and trusts; it is not available for companies. The relief also applies to gifts and non-arm’s-length sales.

This guidance note sets out the main qualifying conditions for BADR, how the relief is calculated and claimed, and details on associated disposals.

HMRC guidance is set out at CG63950P

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  • 05 Dec 2024 15:00

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