Investors' Relief
A Capital Gains Tax relief that applies a reduced flat rate on gains from disposing of shares in unlisted trading companies, aimed at encouraging external investors in small businesses. The rate was 10% until April 2025, rising to 14% for 2025-26 and 18% for 2026-27. To qualify, shares must have been held for at least three years and issued after 17 March 2016, and the investor must not be an employee of the company. There is a separate lifetime limit of £1 million of qualifying gains distinct from the BADR lifetime limit.
Related Terms
Capital Gains Tax
A tax on the profit (gain) you make when you sell or dispose of an asset that has increased in value, such as shares, investment property, or business assets.
Business Asset Disposal Relief (BADR)
A Capital Gains Tax relief on qualifying business disposals — charged at a flat rate of 10% for 2024/25, 14% for 2025/26, and 18% from April 2026 — up to a £1 million lifetime limit per individual.
Annual Exempt Amount
The amount of capital gains you can make in a tax year before Capital Gains Tax becomes due, currently £3,000 for individuals.
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