Taxation of Chargeable Gains Act 1992 Schedule A1 paragraph 3

Rules for determining whether a gain is a gain on the disposal of a business

Schedule A1 paragraph 3 sets out the rules used to determine whether a chargeable gain qualifies as a gain arising from the disposal of a business, which is relevant for the purposes of entrepreneurs' relief (now known as business asset disposal relief).

• A gain qualifies as a business disposal gain if it arises from the disposal of all or part of a business that the individual has owned and operated, or from the disposal of assets used in such a business.
• The rules specify the conditions that must be met regarding the period of ownership and the nature of the business activity carried on by the individual or through a qualifying partnership or company.
• Specific criteria apply to disposals of shares or securities in a trading company or the holding company of a trading group, including requirements around the individual's shareholding and involvement in the business.
• The paragraph was amended by Finance Act 2008 Schedule 2 paragraph 45, which introduced and refined the framework for identifying qualifying business disposals.