Getting the best out of Business Asset Disposal Relief

Business Asset Disposal Relief (BADR), formerly known as Entrepreneurs’ Relief, has long provided a valuable Capital Gains Tax (CGT) relief on the disposal of eligible business assets.

Why it’s important now

The Autumn Budget 2024 announced a two-stage increase in the CGT rate applying where BADR is available. For disposals made on or after 6 April 2025, the rate of CGT is now 14%, rather than 10%. It will rise again to 18% for disposals made on or after 6 April 2026. There are also anti-forestalling rules designed to counter arrangements locking in lower CGT rates.

Action to consider now

The period to 5 April 2026 is a particularly critical time to take stock, giving a potential last chance opportunity to take advantage of the 14% rate of CGT applying to disposals – so long as all the relevant conditions are met. In view of this, you might want to consider whether you want to accelerate any plans you have for.

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