Require Immediate Support? Free Director Helpline: 0800 644 6080

Real Business Rescue

Free Director Helpline: 0800 644 6080

Understanding Business Asset Disposal Relief (BADR) in a solvent liquidation (MVL)

Business Asset Disposal Relief – which used to be known as Entrepreneurs’ Relief – is a tax relief scheme which can lower the payable rate of Capital Gains Tax upon the sale or liquidation of a solvent company. With Business Asset Disposal Relief, Capital Gains Tax can be reduced to 10% for qualifying gains up to a lifetime limit of £1m.

What is Business Asset Disposal Relief (or Entrepreneurs’ Relief) in a solvent liquidation and do I qualify?

Business Asset Disposal Relief is a tax relief scheme which allows you to halve the effective rate of Capital Gains Tax (CGT) from a top rate of 20% down to just 10% on the sale or disposal of qualifying assets. This can represent a huge tax saving for company directors who meet the qualifying conditions. Business Asset Disposal Relief was known as Entrepreneurs' Relief until 6 April 2020.

In order to benefit as a company director or employee, you must have a minimum shareholding of 5% when the sale or disposal is made. There is no limit to the number of businesses you can sell and still qualify for this scheme, however, Business Asset Disposal Relief has a lifetime limit set at £1 million worth of capital gains.

background curve

Take Our Free 60 Second Test

Get an instant understanding of your:

  • Debt and Asset Position
  • Formal Insolvency Options
  • Next steps

Plus much more ...

Start The 60 Second Test
apps on mobile screen

How can you make a claim for Business Asset Disposal Relief?

When you dispose of a business, or part of a business, you may be eligible to claim Business Asset Disposal Relief (sometimes known as Entrepreneurs’ Tax Relief). Disposal can be facilitated through a sale or gifting of the business, or closing down the company through a solvent liquidation procedure known as Members’ Voluntary Liquidation (MVL).

By claiming Business Asset Disposal Relief you reduce the liability for CGT, but you must meet the qualifying conditions during the two years prior to the disposal or sale.

Looking to close your company?

Whether your company is solvent or insolvent, there are a number of ways to bring your business to a close. Speak to a member of the Real Business Rescue team today to understand your options.
The team are available now -  0800 644 6080

60 Second Test Find Your Nearest Office

The deadline for claiming is the 31 January of the year following the tax year in which the sale or disposal was made.

At Real Business Rescue, our licensed insolvency practitioners and experienced business advisers are well placed to support you through your business exit strategy and provide industry-leading advice on Business Asset Disposal Relief/ Entrepreneurs’ Relief. We provide a free initial consultation at your convenience and assist directors, shareholders, and stakeholders across the UK through an extensive network of 100+ offices.

reviews io logo

Real Business Rescue are here to help

Still unsure whether liquidation is right for your company? Don't worry, the experts at Real Business Rescue are here to help. Our licensed insolvency practitioners will take the time to understand the problems your company is facing before recommending the best course of action going forward based on your own unique circumstances.

  • UK’s Largest Liquidators
  • 100+ Offices Nationwide
  • 100% Confidential Advice
  • Supported 25,000+ Directors
Meet The Team
Team Of 4

Team of Qualified Experts

Trusted team of experts on hand to assist

Meet The Team
Rbr Accreditations Blue

Looking for immediate support?

Complete the below to get in touch

Here at Real Business Rescue we take your privacy seriously and will only use your personal information to contact you with regards to your enquiry. We will not use your information for marketing purposes. See PRIVACY POLICY
10,000+ Tests Completed

Free 60 Second Test

For Ltd Company Directors

Get An Instant Understanding Of Your:

  • Debt and Asset Position
  • Director and Liability Review
  • Next Steps

Plus much more ...

Real Business Rescue Recommended
  • UK's leading business funders
  • Free Brokerage Service
  • Full Market Access
  • Over 30 years' experience
  • Strong relationships with HMRC
  • Support from start to finish
  • 10,000 potential buyers
  • 12,000+ Businesses Sold
  • 60+ Years Experience
Next Steps

We provide free confidential advice with absolutely no obligation.
Our expert and non-judgemental team are ready to assist directors and stakeholders today.