United Kingdom – Chancellor of the Exchequer’s Budget statement
Alasdair Darling, Chanceller of the Exchequer for the UK Governement has announced an extension of Entrepreneurs’ Relief from the first £1 million to the first £2 million of gains made over a lifetime.
Entrepreneurs’ Relief supports business owners and those investing in businesses with growth potential by providing an effective 10 per cent Capital Gains Tax rate on qualifying disposals.
This change will take effect from 6 April 2010.
The Chancellor also announced that the normal rate of capital gains tax (CGT) remains unchanged at 18 per cent.
Direct quote from the Budget statement
“I am also going to make it more attractive for wealth-creators and innovators to set-up their own businesses. To do this, I am doubling entrepreneurs’ relief for Capital Gains Tax. At the moment, the first million pounds of lifetime gains are taxed at a lower rate of 10 per cent, rather than the main rate of 18 per cent.
This threshold will now increase to £2m, enabling entrepreneurs to benefit more from their effort and investment.
And I can also confirm today that I am not increasing the main rate of Capital Gains Tax.”