CG63950 - BADR : Introduction and legislation

The content in this manual covers a much higher level of detail compared to say a Helpsheet supporting the Self Assessmnent Tax Return. If you are looking for an introduction to the main rules for the relief for a particular year please see the Business Asset Disposal Relief (Self Assessment helpsheet HS275) on GOV.UK and select the year you are considering.

Entrepreneurs’ Relief was renamed in Finance Act 2020 with effect from 6 April 2020.  The new name is generally used in this guidance but should be read as applying to times before that date.

Finance Act 2008 introduced Entrepreneurs’ Relief for gains arising from a material disposal of business assets by individuals and the trustees of certain settlements and disposals of other business assets associated with a material disposal of business assets where certain conditions are met.

The relief was first announced in January 2008 with draft legislation being published shortly after.

Entrepreneurs’ Relief was introduced by FA2008/S7 and Sch3 which inserted the provisions into TCGA 1992 from S169H to S169S. FA2008/Sch3/paragraph5 contains the commencement provisions for Entrepreneurs’ Relief. It applies to disposals made on or after 6 April 2008. 

There have been a number of changes affecting the rules since 2008. Care should therefore be taken to consider the rules as they applied at the date of any relevant disposal.

A general overview of the structure of the guidance and provisions is in the table below.

For convenience the statutory references in TCGA92 are used throughout this guidance. They cover the following areas.

Manual page

-

Legislation

CG63955

Introduction

TCGA92/S169H

CG63970

Claims

TCGA92/S169M

CG63975

Material Disposal of Business Assets by Individual

TCGA92/S169I

CG63985

Disposal of Trust Assets

TCGA92/S169J

CG63995

Disposal associated with relevant material disposal

TCGA92/S169K

CG64005

Relevant Business Assets

TCGA92/S169L

CG64006 Exclusion of Goodwill TCGA92/S169LA

CG64010

Disposal of whole or part of business: conditions and disposal of assets after cessation of a business

-

CG64052

Enterprise Management Investment Scheme shares

-

CG64053 Dilution elections TCGA92/S169SB-SH

CG64055

Meaning of trading company and holding company of a trading group

TCGA92/S169SA

CG64125

Amount of Relief - general

TCGA92/S169N

CG64135 Deferred gains TCGA92/S169T-V

CG64140

Amount of Relief - Trust provisions

TCGA92/S169O

CG64145

Amount of Relief - Special provisions for certain associated disposals

TCGA92/S169P

CG64155

Reorganisations: disapplication of section 127

TCGA92/S169Q

CG64160

Reorganisations: QCB’s

TCGA92/S169R

-

Interpretation

TCGA92/S169S

CG64165

Transitional provisions - Reorganisations: QCB’s

FA08/SCH3/PARA7

CG64170

Transitional provisions - Enterprise Investment Schemes

FA08/SCH3/PARA8

-

and Venture Capital Trusts

-

CG64172 Reduction in lifetime limit from 11 March 2020 – anti-forestalling rule for unconditional contracts FA20/SCH3/PARA3
CG64173 Reduction in lifetime limit from 11 March 2020 – anti-forestalling rule for Section 169Q elections FA20/SCH3/PARA4-5