Investors’ Relief guidance

HMRC has published an updated Investors’ Relief help sheet for 2023-24. The help sheet is entitled Investors' Relief 2024 (HS308).

Investors’ Relief reduces the amount of Capital Gains Tax (CGT) on a disposal of shares in a trading company that is not listed on a stock exchange. Individuals and trustees who qualify can claim the reduced CGT rate of 10% on relevant gains, up to an overall limit of £10m.

To qualify for Investors’ Relief, you have to have subscribed for shares that meet the relevant qualifying conditions throughout the period you have owned them and that you have owned for at least 3 years. The main conditions that must be met are:

• they are ordinary shares in the company;
• you subscribed for them in cash, and they were fully paid up when issued;
• the company is a trading company or the holding company of a trading group;
• none of the company’s shares are listed on a stock exchange; and
• neither you nor any person connected with you is an employee of the company or of a company connected with it.

A claim should be made by the first anniversary of the 31 January following the end of the tax year in which the qualifying disposal takes place. For a qualifying share disposal in the tax year 2023-24 (ending on 5 April 2024) a claim for Investors’ Relief must therefore be made by 31 January 2026. A claim to Investors’ Relief may be amended or revoked within the time limit for making a claim.

If you're an investor and you need some Tax Advice, give our expert team of tax advisors a call on 01380 723692 and they'll be happy to suppprt you.