How much tax will I pay when I sell my business?

From 6 April 2026, qualifying gains up to your £1 million lifetime limit are taxed at 18% under Business Asset Disposal Relief. Above that a higher rate taxpayer pays 24%. On a £1,500,000 gain that comes to about £299,280.

A worked example

The gain
£1,500,000, on shares that qualify for the relief, sold by a higher rate taxpayer who has not used any of their lifetime limit.
The first £1 million
Taxed at 18%: £180,000.
The annual exempt amount
£3,000 of the rest is tax free.
The remaining £497,000
Taxed at 24%: £119,280.
Total
£299,280.

Rates from gov.uk, 2026/27, checked 2 October 2026. A basic rate taxpayer pays 18% on gains within their unused basic rate band.

What changed in April 2026

The rate under Business Asset Disposal Relief was 10% until 5 April 2025, 14% for 2025/26 and 18% from 6 April 2026. On the first £1 million of gains, that is a difference of £80,000 between a sale before April 2025 and one today.

The relief has conditions about the shares you hold and your role in the company, and your accountant confirms whether a sale qualifies before it completes.

The first million is taxed at 18%. Everything above it is taxed at 24%, and the line is drawn across your whole life.

Related questions

Is the £1 million limit per sale?

No. It is a lifetime limit on gains that qualify for the relief.

When is the tax paid?

Capital gains tax on a business sale is reported and paid through your tax return. Your accountant will confirm the dates for your sale.

Where this fits

What the proceeds do next is the part we plan with you.

Selling or passing on your businessGet a complimentary health check

The advisers for this subject

Sunny Bharj

Sunny Bharj

Independent Financial Adviser

Tony Springer

Tony Springer

Independent Financial Adviser

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