Posted: 12/09/18 by BRI Business Recovery & Insolvency
Headlines such as “Use entrepreneur tax relief cash to help fulfil NHS £20bn funding pledge, think tank says” (National Health Executive) might be further evidence that the days of this tax relief may now be numbered.
Entrepreneurs relief (“ER”) is the driver behind most Members Voluntary Liquidations (“MVL”). These are solvent liquidations where the director/shareholders are taking out the money left in their company at the end of that company’s life. The business of the company may well have been sold but the vehicle used for trading is no longer required – the results of what might have been many years efforts are now there to be enjoyed. The relief reduces the Capital Gains Tax (“CGT”) rate to 10% for qualifying shareholders.
In January of this year, under the headline, “How to hedge your finances against a future Corbyn government” the FT were saying, “Investors might also choose to sell assets, in an attempt to lock in the current low rates of capital gains tax. Owners of small businesses might be concerned that “entrepreneurs’ relief” that reduces the rate of tax to just 10 per cent might be axed.”
In the current political climate the view appears to be forming that this is an easy kill. Removing a tax relief granted to already wealthy individuals (as if all entrepreneurs are outstandingly wealthy) who, in general, are older (it still takes most people 10 years to be an overnight success – those taking advantage of entrepreneurs relief are mostly in their fifties and above). It is not likely to adversely affect the finances of the much courted younger voter. It is an easy, relatively painless,fix.
Unless, of course, you are one of those affected.
If you have been thinking about taking advantage of Entrepreneurs Relief in the next little while you might want to hurry along to BRI now to talk about solvent liquidations and how you might be able to secure your position. It could be a case of – buy now; while stocks last. Call on 01604 754352 or check out: https://www.briuk.co.uk