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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15976
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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Tony (Tax) - I am seriously considering ordinary shares l own

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Tony (Tax) - I am seriously considering ordinary shares l own in a private closed limited company. The sale price is fixed although l will be paid over a number of years. is there any advice you can give me in order to help mitigate my forth coming Tax bill. Thank you

If you qualify for entrepreneurs' relief on the share disposal, any CGT liability will be restricted to 10% of the gain and you should be able to pay the tax in instalments. As the rate of CGT on gains not qualifying for ER is charged at 18% or 28% or a combination of the two rates depending on the level of your income, the lower your income is the lower the CGT will be as a consequence. The qualification rules for ER are set out in HS275.

If you reinvested the sale proceeds into a new business asset as described in HS290 you can defer the CGT but you will lose out on entrepreneur's relief on the initial disposal.

I hope this helps but let me know if you have any further questions.
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