Reforms to Capital Gains Tax could prove costly for Entrepreneurs

Few commentators are predicting its total abolition, but it is seem by many to be too generous.

The 10% rate of tax for most business owners when they sell up, combined with a lifetime limit of £1m per person was intended to cost only £900m last year, but with the limit now sitting at £10m per person the cost has more than trebled.

Following the General Election in May, we could see significant restrictions to the relief whatever the shape of the Government. In my view an “excess” cost of £2bn is simply too large to ignore, but I just do not see it as feasible to make any predictions about the details of the changes.

Everyone who is contemplating making a large capital gain in the next 3 years or so should review what can be done now to secure their entitlement to the current level of relief and pre-empt any reforms, which in most cases can be done without bringing forward the payment of the tax.

For more information or to discuss implications for yourself please contact Nick Scull 01904 464100 or nscull@garbutt-elliott.co.uk.