By Nick James
In many ways George Osborne is between a ‘rock and a hard place’ with his first full budget — he has little opportunity of providing relief to many people apart perhaps from entrepreneurs.
If Entrepreneurs are being asked to fill the jobs vacuum left by public sector cuts then all incentives are welcome and there is perhaps room for movement in defining what are qualifying gains regarding Entrepreneur's Relief.
Entrepreneur’s Relief was brought in by the last administration and took effect from 6 April 2008.
Entrepreneur’s Relief is made available on gains made on the disposal of all or part of a business and currently means that Capital Gains Tax will be paid at an effective rate of 10 per cent as opposed to 28%.
However, Entrepreneur’s Relief is currently only available to shareholders that own at least five per cent of the ordinary share capital of the company.
In his initial budget Mr Osborne extended the scheme to the first £5 million of lifetime gains — maybe in this budget he can extend the scheme even further to include all shareholders and therefore further incentivise business growth.