Policy paper

Entrepreneurs’ Relief where shareholding ‘diluted’ below the 5% threshold

This measure allows individuals whose shareholding is ‘diluted’ below the 5% threshold as a result of a new share issue to obtain relief for gains up to that time.

• From: HM Revenue & Customs
• Published: 6 July 2018

Documents

Entrepreneurs’ Relief where shareholding ‘diluted’ below the 5% threshold

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Draft legislation

PDF, 68.4 KB, 4 pages

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Explanatory note

PDF, 405 KB, 4 pages

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Details

The measure ensures that entrepreneurs are not discouraged from seeking external investment to finance business growth in circumstances where their own shareholding becomes diluted.

This is part of the government’s response to the patient capital review, and is in line with the government’s policy of supporting enterprise and entrepreneurship.

A consultation with a summary of responses about allowing Entrepreneurs’ Relief on gains made before dilution is also available.

Published 6 July 2018