Cookies at Which? We use cookies to help improve our sites. If you continue, we'll assume that you're happy to accept our cookies. Find out more about cookies

Capital gains tax if you own a business

By Ian Robinson

Put us to the test

Our Test Labs compare features and prices on a range of products. Try Which? to unlock our reviews. You'll instantly be able to compare our test scores, so you can make sure you don't get stuck with a Don't Buy.

Capital gains tax if you own a business

If you are selling a business you own, you may qualify for a special capital gains tax relief called entrepreneurs’ relief. 

You can claim entrepreneurs' relief  if:

  • you are a sole trader or partner selling part or all of your business or its assets, or
  • you control at least 5% of a company the shares or assets of which you are selling
  • you sell assets from the above businesses within three years of closing down.

The relief effectively reduces the capital gains tax rate to 10% on the first £10m of gains you make over your lifetime from selling such assets. Any gains above this are taxed at 20%. The relief applies if you run a trading business or furnished holiday letting, but not any other property-letting business.

  • Last updated: April 2016
  • Updated by: Ian Robinson