Entrepreneurs' relief

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In the United Kingdom, entrepreneurs selling their business (technically "qualifying assets") can claim entrepreneurs' relief.[1] This is a lifetime allowance of £10,000,000 of gain that will be taxed at a reduced rate of 10%. To be eligible, a shareholder must have a 5% or more shareholding, and have been involved for a year or more with a company as an employee or director. Capital distributions from a limited company can occur as a result of a member's voluntary liquidation, and resulting profits are subject to CGT. Return of share capital following a resolution at the AGM is not classed as capital gains.[2]

Entrepreneurs' relief was raised to £2 million in the March 2010 budget,[3] and then to £5 million three months later by the new Conservative/Liberal coalition government. In the March 2011 budget it was raised to £10m.[4]


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