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ACCA Strategic Professional · Advanced Taxation (UK) · Capital gains tax: gains and losses on the disposal of movable and immovable property

Under the rates in the Finance Act 2025 tax tables for ATX-UK, which statement correctly describes the lifetime limits and rate for business asset disposal relief (BADR) and investors' relief?

Business asset disposal relief and investors' relief each have their own £1,000,000 lifetime limit, and gains within those limits are taxed at 14%. The limits are not shared, so an individual can use both in full.

  1. ABADR has a lifetime limit of £1,000,000, investors' relief has a lifetime limit of £1,000,000, and gains qualifying for either relief are taxed at 14%Correct
  2. BBADR has a lifetime limit of £1,000,000, investors' relief has a lifetime limit of £10,000,000, and both are taxed at 14%
  3. CBoth reliefs share a single combined lifetime limit of £1,000,000, and qualifying gains are taxed at 18%
  4. DBADR has a lifetime limit of £1,000,000 taxed at 14%, while investors' relief gains are taxed at 24% above the annual exempt amount

Explanation

The tax tables show a £1,000,000 lifetime limit for BADR and a separate £1,000,000 lifetime limit for investors' relief, with a 14% rate. The limits are not combined. Options with a £10,000,000 limit or an 18% or 24% rate misstate the tables.

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