Business Asset Disposal Relief on Liquidation in the United Kingdom
What was formerly known as Entrepreneurs Relief is now known as Business Asset Disposal Relief (BADR). It is a tax relief benefit that can reduce the Capital Gains Tax (CGT) that is paid on the sale of the assets of a solvent company that is either being liquidated or sold. When a solvent company is liquidated, it is through a Member’s Voluntary Liquidation process in accordance with the laws dictated by the Insolvency Act 1986. When the assets of the solvent liquidated company are sold, CGT is applied but directors of the company that qualifies for BADR are able to pay half the amount of tax on the capital gains rather than the standard amount. So, how does Business Asset Disposal Relief work ?