Capital Gains Tax Advice

Capital Gains Tax is applicable to the sale or transfer of many large assets.

It’s crucial to understand what capital gains tax you need to pay with it applying  to both individuals and businesses.

Some careful planning can help you reduce what CGT you need to pay or let you know when you can defer payment. In some cases a capital gains tax bill can be avoided completely.

There’s quite a lot to consider so before you make a sale or even after it’s happened getting some expert CGT advice is worthwhile.

How a CGT Adviser can help you

Hiring a capital gains tax advisor can ensure that all the relevant factors are reviewed so you receive the most comprehensive advice, including:

  • Establishing your ‘chargeable assets’.
  • Defining at which rate you pay Capital Gains Tax – 18%, 28% or 10%.
  • Working out how much CGT you would pay on a ‘disposal’ (when you sell or give away an asset) before it is actioned.
  • Figuring out the best timing for any item ‘disposals’.
  • Guiding payments of gifts by calculating the amount of CGT that will be owed.
  • Indicating the CGT consequences when ‘disposing’ of a property in the UK as a non-resident.
  • Recommending when the transference of assets between married couples or civil partners is prudent.
  • Applying the relevant tax reliefs, such as Lettings Relief, Principle Private Residence relief and Entrepreneurs’ Relief.
  • Indicating which exemptions are applicable to your situation. These may include spouse exemption, gifts to charity and annual exemption.

If you would like to find out more about CGT you can use our free Guide to Capital Gains Tax » which gives you a breakdown on factors like the capital gains tax allowance and CGT rates.

Business Asset Disposal Relief and CGT

Entrepreneurs’ Relief, now known as Business Asset Disposal Relief since April 6, 2020, is a tax reduction scheme applicable when a business or a part of it is sold.

To be eligible for this relief, the business owner needs to have owned the business for a minimum of two years and must be a sole trader or a business partner.

This relief reduces the Capital Gains Tax rate to 10% for qualifying cases, including the closure of a business. Additionally, to qualify for BADR, the business assets must have been disposed of within three years.

The rules covering BADR can become complex very quickly which usually means using a CGT advisor is a valuable choice to avoid costly mistakes.

A capital gains tax advisor can review your eligibility for BADR and make use of the capital gains tax relief where possible.

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