The 2020 spring Budget proposed a reduction in the lifetime
limit for gains qualifying for entrepreneurs’ relief from £10m to £1m, and Sch
2 to the Finance Bill will introduce the change for qualifying disposals made
on or after 11 March 2020.
The CIOT has called
for greater scrutiny of the proposals, urging a broader public consultation
about the objectives and effectiveness of entrepreneurs’ relief to consider the
economic rationale of other aspects beyond the lifetime cap, such as the 5%
ownership condition (where the sale is of a company), the two-year ownership
requirement and ‘more widely the overall policy intent and whether alternative
means of meeting it are more appropriate’. Although perhaps not material to
these key considerations, some commentators have questioned the government’s intentions
for the relief, with the Finance Bill also rebranding the relief as business
asset disposal relief – or ‘BAD relief’ in short.
The 2020 spring Budget proposed a reduction in the lifetime
limit for gains qualifying for entrepreneurs’ relief from £10m to £1m, and Sch
2 to the Finance Bill will introduce the change for qualifying disposals made
on or after 11 March 2020.
The CIOT has called
for greater scrutiny of the proposals, urging a broader public consultation
about the objectives and effectiveness of entrepreneurs’ relief to consider the
economic rationale of other aspects beyond the lifetime cap, such as the 5%
ownership condition (where the sale is of a company), the two-year ownership
requirement and ‘more widely the overall policy intent and whether alternative
means of meeting it are more appropriate’. Although perhaps not material to
these key considerations, some commentators have questioned the government’s intentions
for the relief, with the Finance Bill also rebranding the relief as business
asset disposal relief – or ‘BAD relief’ in short.
