What is the Business Asset Disposal Relief rate for 2026/27?

Full answer

Business Asset Disposal Relief, formerly Entrepreneurs' Relief, gives a reduced rate of Capital Gains Tax when you sell qualifying business assets. For 2026/27 the BADR rate is 18%, having increased from 14% to 18% on 6 April 2026 as part of a phased rise from the original 10%. The relief applies to the first £1,000,000 of qualifying gains over your lifetime, so gains above that cumulative limit are taxed at the normal CGT rates of 18% or 24%. To qualify, you generally need to have owned the business or shares for at least two years before the sale, and for company shares you usually need at least 5% of the ordinary shares and voting rights and to be an officer or employee. Sole traders and partners can claim on the sale of all or part of their business, and the relief can also apply to associated disposals linked to a withdrawal from the business. Even at 18%, BADR can be valuable compared with the standard 24% higher rate. You claim it through Self Assessment, normally by the first anniversary of the 31 January after the tax year of disposal. Because the rules and rates have been changing, timing a sale around the 6 April rate change can make a meaningful difference. Use the Capital Gains Tax calculator to compare a BADR disposal with a standard-rate disposal.

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More answers

• What is Business Asset Disposal Relief (BADR)?
• What is Entrepreneurs Relief called now?