28/10/2026
The Autumn Budget has confirmed a change to Business Asset Disposal Relief, a tax relief that eligible directors can claim when they close a solvent company.
If you qualify, BADR means you pay 18% tax on the money you take out the business, rather than up to 24%. But from 6th April 2027, you’ll only be able to claim it on up to £500,000 over your lifetime, reduced from £1 million.
If you’re thinking about closing your solvent company in the next year, there are three things you can do now:
1. Check whether you qualify - There are conditions, including holding at least 5% of the company’s shares and being a director or employee for at least two years.
2. Check how much is in your company and whether you’ve claimed the relief before - Earlier claims count towards your limit, so it’s best to check how much you have left.
3. Speak to your accountant and our team - Deciding to liquidate before April doesn’t automatically mean the current limit applies, so it’s worth getting some guidance first.
Get in touch with us today to talk through your options: https://bit.ly/4k9Uydx