Gift relief for business assets ― restrictions

Produced by a Tolley Owner-Managed Businesses expert

Owner-Managed Businesses

Guidance

In certain situations, gift relief is available to defer capital gains on gifts of business assets, which would otherwise be immediately chargeable to CGT.

This guidance covers restrictions on gift relief where a transferor gives away shares of a company holding non-business assets or where only part of an asset or holding period was used for business purposes.

For an introduction to gift relief for business assets, including the definition of business assets, and information about making claims and the possibility of paying tax in instalments, see the Gift relief for business assets guidance note.

Restriction for non-business assets in a company

Gift relief may not always completely eliminate the capital gain as sometimes gift relief is restricted. The most common example is where a transferor gives away shares in their personal company, and that company holds non-business assets.

If this is the case, the amount of the gain which qualifies for gift relief is restricted by the following fraction:

Gain eligible for gift relief = CBA/CA x gain

Where:

•
CBA is the market

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, generative tax AI, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Personal Tax

VAT on property disposals

VAT on property disposalsThis guidance note provides an overview of the VAT treatment of selling property that is located in the UK. The UK includes Great Britain, Northern Ireland and the territorial sea of the UK. The sale of any land or building located outside the UK is outside the scope of UK

14 Jul 2020 13:57 | Produced by Tolley Read more

Corporation Tax

FRS 102 ― tax presentation and disclosures

FRS 102 ― tax presentation and disclosuresPresentation of tax under FRS 102An entity must present changes in a current tax liability (or asset) and changes in a deferred tax liability (or asset) as a tax expense (or income) unless the item creating the current or deferred tax amount is recognised in

14 Jul 2020 11:46 | Produced by Tolley in association with Malcolm Greenbaum Read more

Corporation Tax

Research and development (R&D) relief ― overview

Research and development (R&D) relief ― overviewThis guidance note provides an overview of the research and development (R&D) tax reliefs for companies.See the Research and development tax relief summary diagram which summarises the R&D tax relief.See also Simon’s Taxes D1.401.For a factsheet which

14 Jul 2020 12:22 | Produced by Tolley in association with Will Sweeney Read more

��Ƶ