Selling your business
If you are wondering whether, or when, you should dispose of your business, a sensible first step is to form an outline plan.
The sale of a successful trading company will generate a capital gain. This would normally be taxed at 20% after deduction of your annual exemption (£12,300 for 2021/22).
Business Asset Disposal Relief can reduce your tax rate to 10% on gains of up to £1m. However, this is a lifetime limit, so if you have already taken advantage of this relief in the past (it was formerly called Entrepreneurs’ Relief) you may not be able to make a further claim on the disposal of your business.
If you want to be sure of benefiting from capital gains reliefs, take advice and plan early.
| Action Point! |
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| Be prepared for selling your business by planning early! |