Entrepreneurs' relief

Entrepreneurs’ relief is one of the most attractive tax benefits any entrepreneur can get. By taking appropriate steps, entrepreneurs may gain maximum benefit from entrepreneurs’ relief. Today, in the United Kingdom entrepreneurs selling or giving away their business can obtain entrepreneurs’ relief which is an allowance of £10,000,000

There are some measures that need to be taken care of to gain maximum benefit from entrepreneurs’ relief. If the requirements for availing entrepreneurs’ relief are fulfilled appropriately, then any entrepreneur selling or giving away their business may gain a lot of benefits and the entrepreneurs’ relief may prove to be quite useful.

However, it is a relief that needs to be claimed so the onus is on entrepreneurs to keep the relevant records and ensure that claims are received within the time limit.

Qualifying for Enterpreneurs’ Relief

Given the attractiveness of this relief, it is unsurprising that there are some strict qualification criteria. We have seen some precarious situations where entrepreneurs have assumed they would be eligible but some seemingly unrelated business decisions may then call that into question.

You need to be confident of your position before you consider disposing all or part of your business.

We can also look at the tax structures well in advance to ensure that you are correctly placed to qualify.  

We regularly help entrepreneurs to make these claims successfully.

Ways we have helped:

• We have helped structure businesses that have various classes of shares in order to ensure that the shareholder has appropriate share rights whilst maintaining entrepreneurs’ relief entitlements.
• We have helped entrepreneurs bank the benefit of entrepreneurs’ relief in cases that they sell interest in the business in exchange for minority (less than 5%) ownership of the acquiring vehicle.
• We have maximised entitlements to entrepreneurs’ relief through approved share option planning.