What’s Changing with Gift Hold-Over Relief for Business Assets
On 23 June 2026, HMRC published a policy paper updating rules for Capital Gains Tax (CGT) relief on gifts of business assets. The changes revise how relief works when a gifted company has assets not used in trade, especially assets covered by the Substantial Shareholding Exemption (SSE) or Intangible Fixed Assets (IFA) regimes. (gov.uk)
Key Provisions
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Assets under SSE or IFA inclusion: Previously, the restriction formula didn’t count assets sheltered by those regimes. From 6 April 2027, those assets will count as “chargeable assets” when determining hold-over relief eligibility. (gov.uk)
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Operative date: Applies to disposals made on or after 6 April 2027 only. (gov.uk)
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Impacted group: Individuals gifting shares or securities of a trading company (or holding company of a trading group), especially where the company has both trading and non-trading assets, will feel the effects most. (gov.uk)
What This Means in Practice: Examples
- Scenario A: Parent owns a trading company that also holds intangible assets under IFA. If parent gifts shares, and non-trading/intangible assets make up a large part, relief may be less generous.
- Scenario B: Company is purely trading. Including SSE/IFA assets won’t change much—hold-over relief remains broadly intact.
Action Steps for Tax Planning & Succession
- Audit your company’s balance sheet to understand how much non-trading, intangible fixed assets or assets under SSE it holds.
- Front-load gifting where possible before 6 April 2027 to get more generous relief under old rules.
- Plan share transfers strategically, e.g., to family members whose shares will stay within a purely trading structure.
- Use valuation advice to understand how much relief you might lose if assets don’t qualify under trading status.
Strategic Implications
- Those doing succession planning, such as business owners passing shares to heirs, must act before the operative date to maximise relief.
- For businesses with mixed-asset portfolios, there might now be increased incentive to reorganise asset ownership so trading assets are cleaner, non-trading assets split off.
- Advice from specialists (corporate tax and valuation experts) becomes more critical.
Summary
From 6 April 2027 new rules will make Gift Hold-Over Relief more stringent for companies holding non-trading assets, SSE assets, or under the IFA regime. To protect advantages, tax planning, especially for gifts and business succession, needs to begin well before that date.