All posts with the topic: Capital Gains Tax

The ability to offer tax-favoured employee shareholder shares or ESS, until recently very common in private equity company arrangements, has been withdrawn with almost immediate effect. The only ESS arrangements that can now be completed are those where the independent advice has been given in which case the relevant employee shareholder agreement must be entered … Continue reading No more ESS arrangements possible

Today’s Budget continued the recent trend of announcing changes to the ER regime. However, unlike previous Budgets, today’s changes generally expand the situations in which ER will be available. The main change is the extension of ER to shares held by individuals who are external investors rather than employees or directors. The Budget materials also … Continue reading Entrepreneurs’ relief – not just for entrepreneurs

George Osborne’s 2016 Budget contains a surprisingly broad range of new tax measures addressing everything from sporting testimonials to oil fields.  However, the main changes are as follows. Companies Corporation tax will come down to 17% from April 2020. From April 2017, companies will only be able to use carried forward losses against 50% of their profits above … Continue reading Budget 2016 – headline points

In a surprise move in today’s Budget, the Chancellor has slashed the rate of capital gains tax from 28% to 20% (or, for basic rate taxpayers, from 18% to 10%).  These changes come into effect from 6 April 2016.  This will be great news for any employee holding shares in their employer company and, in … Continue reading Employee Share Incentives: a sprinkling of sugar but a cap on ESS

Territorial limitations on the scope of UK taxes open up the possibility of tax free property development. At least this is the case for non-UK residents who can arrange matters such that they avoid a permanent establishment in the UK (for example, a site office or show-home) and are resident in a jurisdiction with a … Continue reading Profits from Trading in and Developing UK Land

Gains arising on or after today via carried interest are subject to new computational rules. Essentially, an affected individual will be taxed by reference to the full amount received less any sums actually invested by that individual. Whilst a capital gains treatment is preserved, it is intended that gains will be calculated in line with … Continue reading Carried interest – raising the effective rate of capital gains tax

Universities will often set up spin-out companies to commercialise the intellectual property generated by their academic research projects.  Spin-out companies are particularly common in the life sciences and technology sectors.  University academics and researchers who have assisted with the development of the intellectual property will frequently receive shares in the spin-out company as a reward … Continue reading Spinning-out entrepreneurs’ relief

As announced in the Autumn Statement, ER no longer applies in respect of disposals of goodwill to a ‘related’ company on or after 3 December 2014.  However, the draft legislation revealed that the changes will have a wider impact than originally anticipated. Today’s Budget announces a change to the draft legislation to deal with one … Continue reading Entrepreneurs’ relief in relation to transfers of goodwill

In addition to the changes restricting the application of entrepreneurs’ relief to management company structures and transfers of goodwill, the Chancellor has also restricted the availability of ER on associated disposals of assets. ER is a business tax incentive and therefore applies, subject to conditions, on sales of: unincorporated businesses or interests in partnerships carrying on businesses; … Continue reading More on Entrepreneurs’ Relief: associated disposals

George Osborne announced in today’s Budget: “We will close loopholes to make sure entrepreneurs’ relief (ER) is only available to those selling genuine stakes in businesses”. Having now seen the detail of these proposed changes, we find that he has made some targeted changes to the circumstances in which ER can apply but otherwise left … Continue reading Targeted changes to entrepreneurs’ relief – management companies