What Has Changed
Between October 2024 and April 2026, CGT rates for business owners have risen sharply. Business Asset Disposal Relief (BADR) now charges 18% on the first £1 million of qualifying gains (up from 10%). The standard rate is 24% (up from 20%). Investors’ Relief was cut to a £1 million limit.
What It Costs in Practice
A business owner selling for a £2 million gain now pays approximately £420,000 in CGT — up from £300,000 under the old rules. That is £120,000 more tax on the same sale. For larger disposals, the increase is proportionally greater.
What You Can Still Do
- Use both spouses’ BADR allowances — each person has a £1 million lifetime limit
- Consider an EOT — still the most tax-efficient exit at ~12%, despite the halved relief
- Use holdover relief for gifts of business assets to the next generation
- Time the disposal across tax years to use annual exemptions
- Integrate with estate planning — holding until death avoids CGT entirely, but IHT may apply
The Key Point
Higher rates make planning more important, not less. The difference between a well-planned and poorly-planned disposal can easily exceed £100,000. Get advice before you commit to a sale structure.