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Selling a business · 2026/27

Business Asset Disposal Relief Calculator

Capital gains tax on selling your business or company shares in 2026/27, with Business Asset Disposal Relief at 18% - and what you'd pay without it.

Your sale
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£
£
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For disposals on or after 6 April 2026. Assumes the sale qualifies for the relief and there are no losses or other gains in the year.

Capital gains tax with BADR
£0
Gain£0
Qualifying for BADR (18%)£0
Above your lifetime limit£0
… of which taxed at 24%£0
Lifetime limit left after this sale£0
You keep£0

Claim deadline for a sale in 2026/27: 31 January 2029.

How Business Asset Disposal Relief works in 2026/27

Business Asset Disposal Relief (BADR, formerly Entrepreneurs' Relief) taxes qualifying gains on selling all or part of a business at a flat 18% for disposals on or after 6 April 2026, up to a £1 million lifetime limit. Without it, gains are taxed at 18% only while they fit in your remaining basic rate band and at 24% above it - so for most business sellers the relief turns 24% into 18%.

The relief has become less generous two years running: the rate was 10% until 5 April 2025, 14% for 2025/26 and 18% from 6 April 2026. The same £500,000 gain that now costs £89,460 would have cost £69,580 at 14% and £49,700 at 10% (each after the £3,000 annual exempt amount).

What it's worth at different gains

Higher-rate taxpayer (£60,000 of other income) unless stated; 2026/27 rates; no BADR used before.

GainTax with BADRWithout BADRSavingWith BADR, £20,000 incomeEffective rate
£100,000£17,460£23,280£5,820£17,46017.5%
£250,000£44,460£59,280£14,820£44,46017.8%
£500,000£89,460£119,280£29,820£89,46017.9%
£750,000£134,460£179,280£44,820£134,46017.9%
£1,000,000£179,460£239,280£59,820£179,46017.9%
£1,500,000£299,280£359,280£60,000£299,28020%
£2,000,000£419,280£479,280£60,000£419,28021%

The saving is capped: once the whole £1m limit is used, BADR is worth 6p in the pound on £1m - at most £60,000. On a £1,500,000 gain, £1,000,000 is taxed at 18% and £497,000 at 24% after the annual exempt amount comes off the 24% slice, for a total of £299,280.

The lifetime limit, and what happens above it

The £1m limit counts every BADR claim you have made on disposals since 11 March 2020. If you used £900,000 on an earlier sale, only £100,000 of a new £300,000 gain qualifies: that part is taxed at 18% and the other £200,000 at the normal rates - £65,280 in total for a higher-rate taxpayer. Put what you've already used into the calculator and it does the split for you.

Gains that qualify for BADR also use up any basic rate band you have left before other gains do (HMRC's Capital Gains Manual, CG21000). The 18% on the qualifying slice doesn't change, but it means the slice above the limit is almost always taxed at 24%.

Do you qualify?

The conditions depend on what you're selling, and they must be met throughout the 2 years before the sale:

There are further rules for associated disposals, trustees and EMI shares; HMRC's helpsheet HS275 covers them.

When to claim

You claim BADR through your Self Assessment return or separately, by the first anniversary of the 31 January following the tax year of the sale. HMRC's helpsheet gives the example of 31 January 2028 for a sale in 2025/26, so for a sale in the 2026/27 tax year the deadline is 31 January 2029.

Frequently asked questions

What is the Business Asset Disposal Relief rate for 2026/27?

18% on qualifying gains for disposals made on or after 6 April 2026. It was 14% for disposals from 6 April 2025 and 10% before that.

How much can I claim?

BADR has a £1 million lifetime limit on qualifying gains (for disposals on or after 11 March 2020). Gains above whatever is left of your limit are taxed at the normal Capital Gains Tax rates of 18% and 24%.

Is BADR still worth claiming now the rate is 18%?

For a higher-rate taxpayer, yes: it replaces 24% with 18% on up to £1m of gains, worth up to £60,000. On a £500,000 gain it saves £29,820. For a basic-rate taxpayer the saving is smaller, because part of the gain would have been taxed at 18% anyway.

Who qualifies for Business Asset Disposal Relief?

For shares, the company must be your personal company - you hold at least 5% of the ordinary shares and voting rights (plus the profit or proceeds tests) - and you must be an officer or employee, throughout the 2 years before the sale. Sole traders and partners must have owned the business for 2 years, and assets can qualify if they are disposed of within 3 years of the business stopping.

When do I have to claim?

By the first anniversary of the 31 January after the tax year of the sale. HMRC's helpsheet gives 31 January 2028 for sales in 2025/26, so a sale in 2026/27 must be claimed by 31 January 2029.

Does the £3,000 annual exempt amount still apply?

Yes. HMRC sets it against the gains with the highest rate first, which is the most beneficial order - so if part of your gain is above the lifetime limit and taxed at 24%, the allowance comes off that part.

How does BADR interact with my income?

Gains that qualify for BADR use up any basic rate band you have left before other gains do (HMRC CG21000). That doesn't change the 18% on the qualifying gain, but it means gains above the lifetime limit are almost always taxed at 24%.

Related

Tax on selling a business, by gain Capital gains tax by amount Capital gains tax calculator Inheritance tax calculator Dividend tax calculator Salary vs dividends

Estimates for 2026/27 disposals by an individual, assuming the conditions for relief are met and there are no losses or other gains. Not tax advice: BADR claims turn on facts HMRC can test, so take professional advice on a sale.

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