Setting up multiple companies to separate business interests can seem very straight forward. There are however important considerations. We explore the implications of owning too many companies.
Autumn Budget 2025: Capital Gains Tax Changes
28 November 2024
Accounting & Compliance, Estate Planning / IHT, Property Investors & Developers, Reducing Tax, Selling a Business, Structuring a Business
The only changes in capital gains tax terms were the rates that apply.
These are summarised below for the three different categories of assets:
Residential property
| Rates up to 30 October 2024 | 18% for gain falling to be taxed at basic rate |
| 24% for gain falling to be taxed at above basic rate | |
| Rates from 30 October 2024 | 18% for gain falling to be taxed at basic rate |
| 24% for gain falling to be taxed at above basic rate |
Business property
| Rates up to 30 October 2024 | 10% on first £1 million of lifetime gains |
| 20% once £1 million gains are exceeded | |
| Rates from 30 October 2024 to 5 April 2025 | 10% on first £1 million of lifetime gains |
| 24% once £1 million gains are exceeded | |
| Rates from 6 April 2025 to 5 April 2026 | 14% on first £1 million of lifetime gains |
| 24% once £1 million gains are exceeded | |
| Rates from 6 April 2026 to 5 April 2027 | 18% on first £1 million of lifetime gains |
| 24% once £1 million gains are exceeded |
Other chargeable assets (Shares, commercial property etc..)
| Rates up to 30 October 2024 | 10% on gain falling to be taxed at basic rate |
| 20% for gains falling to be taxed above basic rate | |
| Rates from 30 October 2024 to 5 April 2026 | 18% on gain falling to be taxed at basic rate |
| 24% for gains falling to be taxed above basic rate |
Annual Exemptions & Trusts
There was no change to the annual exemption which remains at £3,000 until further notice.
Trusts will be taxed at 24% on all asset disposals from 30 October 2024.
Planning Opportunities
Although the main rate changes to the capital gains tax rates happened on Budget Day as expected, the rate increases on business assets are coming in gradually on 6 April 2025 (14%) and 6 April 2026 (18%).
That gives business owners time to dispose assets and secure tax at a lower rate of tax.
Even if they cannot or do not wish to sell their business in the near future they could make gifts of assets or use trusts to make a disposal liable to tax at a lower rate.
4% of £1 million is £40,000 of tax, so there is a lot at stake for valuable trading companies, sole traders or partnerships.
Need assistance?
If you’re considering selling your business in the next year or two, it’s essential to plan ahead.
Likewise, if you’re planning to pass on business shares to the next generation, we strongly recommend reaching out to us as soon as possible.
Getting in touch
If you have concerns around your tax position and are looking for opportunities to save tax, please get in touch via the form below or call us on 01634 731390.
Our Services
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Blogs related to Budget & Tax Planning
Take a look at our other blogs on the topic of the Autumn Budget.
What is tax planning? Why Should I do it?
The content in this blog is correct as at 19th November 2024. See terms and conditions.
