CGT relief for serial entrepreneurs (those who reinvest gains)

[Brendan Burgess]

CGT entrepreneurial relief
A new CGT incentive is being introduced to encourage entrepreneurs (in particular “serial” entrepreneurs) to invest and re-invest in assets used in new productive trading activities. The measure will apply where an individual, who has paid capital gains tax on the disposal of assets, makes investments in a new business in the period 1 January 2014 to 31 December 2018 and subsequently disposes of this investment no earlier than three years after the date of investment. The CGT payable on the disposal of this new investment will be reduced by the lower of (i) the CGT paid by the individual on a previous disposal of assets in the period from 1 January 2010 and (ii) 50% of the CGT due on the disposal of the new investment. Commencement of this measure is subject to receipt of EU State Aid approval.

 

[Brendan Burgess]

from the Annex

1. Capital Gains Tax Relief for re-investment of previous asset disposals in
productive assets The measure applies where an individual makes an investment in assets for use in a new productive trading activity in the period 1 January 2014 to 31 December 2018 and subsequently disposes of this investment no earlier than three years after the date of investment. The CGT payable on the disposal of this new investment will be reduced by the lower of the CGT paid by the individual on a previous disposal in the period from 1 January 2010 and 50% of the CGT due on the disposal of the new investment. Target: To encourage individuals to re-invest the proceeds of a previous asset disposal into new productive trading or a new company and therefore to encourage new business and to keep capital focussed on business and the creation and maintenance of employment.