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Entrepreneurs’ relief (now called ‘business asset disposal relief’) is a relief that reduces the rate of capital gains tax payable by business-owners on a disposal of their business. Trustees are able to claim the relief on the disposal of business assets held by them in the same manner that individuals can.

The relief was introduced on 6 April 2008 as ‘entrepreneurs’ relief’ and it retained that name until 6 April 2020. The structure of the relief has remained substantially the same throughout the period, although there have been changes to qualifying conditions and the lifetime limit, which are mentioned in this guidance note. The relief is now referred to throughout as ‘business asset disposal relief’.

Gains that qualify for business asset disposal relief are subject to capital gains tax at the rate of 10% whereas other trust gains are subject to tax at the higher capital gains rates of 20% or for residential property 28% to 5 April