PR HartleyFCA

Chartered Accountant & Registered Auditor

Liquidations


Tax on Gains from Company Liquidations

added 3 March 2016

One way of extracting value from a company is to liquidate it: under current law any gain on liquidation is normally subject to Capital Gains Tax. In particular, in appropriate cases Entrepreneurs' Relief may apply giving a tax rate of 10%.

From 6 April 2016 new rules are to be brought in which will have the effect that in some cases gains on liquidation will instead be taxed as if they were dividends, which at the new dividend rates may lead to a tax charge of up to 38.1%.