Entrepreneurs Relief | Business Accounting and Tax Limited

Entrepreneurs Relief, now officially called Business Asset Disposal Relief, allows eligible UK business owners to pay reduced Capital Gains Tax when selling their business.

This guide covers the latest rates, claim procedures, and key considerations to help you navigate this tax relief effectively.

What Business Asset Disposal Relief Offers

Business Asset Disposal Relief has a lifetime limit of £1 million for gains.

This relief applies to disposals of business assets by sole traders, partners, or shareholders.

Current and Future Tax Rates Explained

The Business Asset Disposal Relief rate is 14% for disposals on or after 6 April 2025.

It increases to 18% for disposals on or after 6 April 2026.

Avoiding Common Claim Mistakes

Anti-forestalling rules prevent tax avoidance by locking in lower Business Asset Disposal Relief rates.

For contracts after 30 October 2024, the disposal date is treated as the completion date for rate purposes.

Understanding the Economic Impact

Government statistics provide cost estimates for tax reliefs like Business Asset Disposal Relief.

These figures do not model behavioural responses but offer insights into policy impacts.

Alternative Relief Options to Consider

From 26 November 2025, 50% of gains on disposals to Employee Ownership Trusts are chargeable.

Business Asset Disposal Relief is not available when claiming Employee Ownership Trust relief.

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Sources:

• Capital Gains Tax — rates of tax - GOV.UK
• Tax relief statistics (January 2026) - GOV.UK
• Business Asset Disposal Relief: How to claim - GOV.UK
• Capital Gains Tax — Employee Ownership Trusts relief reduction - GOV.UK
• CG64174 - Business Asset Disposal Relief: rates from April 2025 and from April 2026: anti-forestalling rule: unconditional contracts - HMRC internal manual - GOV.UK