If a week is a long time in politics, then 15 years is probably equivalent to an eternity.
This morning’s The Times (28 September) carries a story about how Labour has identified five tax ‘loopholes’. These include ‘business relief’ a.k.a. business property relief (don’t get me started on that again), agricultural property relief and business asset disposal relief (BADR). I’m not sure when a statutory relief became a ‘loophole’ just because people claim it.
However, my bigger gripe is that entrepreneurs’ relief, now BADR, was introduced by a Labour chancellor, Alistair Darling, in 2008. Furthermore, it was introduced as a knee-jerk reaction to criticism following the abolition of taper relief. Obviously, having abolished taper relief he couldn’t just reintroduce it, so he remodelled the old retirement relief (which had been replaced by taper relief, with me so far?) and called it entrepreneurs’ relief.
The reason for its introduction was that, in abolishing taper relief, it was realised that a large number of employees with share options would now pay capital gains tax at 18% instead of 10%. The limit was set at £1m as these employees would only make modest gains.
Labour increased the lifetime limit to £2m before the general election in 2010, presumably as a vote winner (Mr Sunak, take note) which they lost to the ConDems (the coalition government).
Presumably, option holders will again suffer (BADR has specific provisions to deal with EMI options), or will we see the introduction of taper relief again?
Politicians can do what they like – tax policy is tax policy – but I sometimes wish they’d read a bit of history.
By the way, has anyone got a client that has claimed investors’ relief (what’s that, ed?) which still has a lifetime limit of £10m?
If a week is a long time in politics, then 15 years is probably equivalent to an eternity.
This morning’s The Times (28 September) carries a story about how Labour has identified five tax ‘loopholes’. These include ‘business relief’ a.k.a. business property relief (don’t get me started on that again), agricultural property relief and business asset disposal relief (BADR). I’m not sure when a statutory relief became a ‘loophole’ just because people claim it.
However, my bigger gripe is that entrepreneurs’ relief, now BADR, was introduced by a Labour chancellor, Alistair Darling, in 2008. Furthermore, it was introduced as a knee-jerk reaction to criticism following the abolition of taper relief. Obviously, having abolished taper relief he couldn’t just reintroduce it, so he remodelled the old retirement relief (which had been replaced by taper relief, with me so far?) and called it entrepreneurs’ relief.
The reason for its introduction was that, in abolishing taper relief, it was realised that a large number of employees with share options would now pay capital gains tax at 18% instead of 10%. The limit was set at £1m as these employees would only make modest gains.
Labour increased the lifetime limit to £2m before the general election in 2010, presumably as a vote winner (Mr Sunak, take note) which they lost to the ConDems (the coalition government).
Presumably, option holders will again suffer (BADR has specific provisions to deal with EMI options), or will we see the introduction of taper relief again?
Politicians can do what they like – tax policy is tax policy – but I sometimes wish they’d read a bit of history.
By the way, has anyone got a client that has claimed investors’ relief (what’s that, ed?) which still has a lifetime limit of £10m?
