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Sam, Accountant
Category: Tax
Satisfied Customers: 7544
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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Our client company was incorporated in the UK in 1996.

Customer Question

Our client company was incorporated in the UK in 1996. Throughout the period from 1996 until 2014 it was the 100% holding company of two UK trading companies (Tiling Retail and Contracting), and owned a commercial building which was rented to the two subsidiaries. The two subsidiaries were liquidated in 2014-15, and for the last year the company has rented the property to 3rd party, arms length tenants.Our client wishes to dispose of the shares in the company to a 3rd party, and I'd like to know, based on the 'trading' history (as opposed to property investment history) of the company, whether or not the shareholders (aged in their 60's) would qualify for UK Entrepreneurs Relief on the disposal of the shares.Thank you.
Submitted: 1 year ago.
Category: Tax
Expert:  bigduckontax replied 1 year ago.

Hello, I am Keith, one of the experts on Just Answer, and pleased to be able to help you with your question.

If both the shareholders are going out of thw business altogether then any gain made on the sale of their shares would be entitled to Entrepreneurs' Relief. This limits the Capital Gains Tax (CGT) to a flat rate of 10% as opposed to the current normal rate of 10 or 20% (18 or 28% if dwellings).

I do hope that I have been able to set your mind at rest on this matter,.