What about Entrepreneurs Relief?
Check your Entrepreneurs Relief (ER) position. New rules mean that shares have to be held for 24 months to attract ER. If ER applies then the first GBP10m of capital gain on a sale is taxed at 10% rather than 20%, creating a GBP1m Capital Gains Tax (CGT) saving. Both a husband and a wife can benefit, provided they are each an officer of the company and hold over 5% of the ordinary shares. ER is very complex and it is easy to accidentally fail the test to qualify, so take advice early, and certainly more than 2 years before a sale.
You should also note that husband and wife holdings are not aggregated, so if the wife owns 7% and the husband 3%, only the wife will get ER. However the husband could transfer his 3% to wife and she would immediately be entitled to ER on the entire 10%.
For more information, please contact a member of our team.
