Q&As

Can an enterprise management incentives (EMI) option holder claim business asset disposal relief in relation to the sale of shares resulting from the exercise of an EMI option if a disqualifying event has previously occurred?

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Published by a ½Û×ÓÊÓƵ Share Incentives expert
Published on: 15 April 2025
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Business asset disposal relief (BADR) is a reduced rate of capital gains tax (CGT) that individuals or trustees, but not companies, can claim when they dispose of business assets. Certain conditions must be met before the relief will apply. In relation to disposals made after 6 April 2025, the effect of the relief is to reduce the rate of CGT on the disposal to 14% on a lifetime limit of gains of up to £1m. Previously, the rate of CGT that applied when BADR was available was 10%, but this was increased by the Finance Act 2025, which also legislated that the rate would be further increased to 18% for disposals made on or after 6 April 2026.

For details of the qualifying conditions for BADR and the lifetime limit that applies to it, see Practice Note: CGT—business asset disposal relief (formerly entrepreneurs' relief).

The sale

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