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ACCA Strategic Professional · Advanced Taxation (UK) · Capital gains tax: gains and losses on the disposal of shares and securities

Which of the following is correct regarding the lifetime limits for investors' relief and business asset disposal relief under the tax rates and allowances for Finance Act 2025?

Each relief has its own £1,000,000 lifetime limit, and qualifying gains are taxed at 14%. Using up business asset disposal relief does not reduce the limit available for investors' relief, as the two limits are separate.

  1. AInvestors' relief has a £1,000,000 lifetime limit and business asset disposal relief has a separate £1,000,000 limit, both taxed at 14%Correct
  2. BBoth reliefs share a single £1,000,000 lifetime limit
  3. CInvestors' relief has a £10,000,000 lifetime limit
  4. DInvestors' relief gains are taxed at 18%

Explanation

The tax tables show a £1,000,000 lifetime limit for each of business asset disposal relief and investors' relief, with a rate of 14%. The limits are separate, so using one does not reduce the other. Sharing a single limit is therefore wrong.

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