The 2008 finance Act following on from the pre-budget report last autumn changes the Taxation of Capital Gains in a major manner.

Firstly it abolishes the indexation allowances for inflationary gains and secondly it abolishes the taper relief previously available for business assets.

With effect from 6th April 2008 Capital Gains will be taxed at 18% except where the "entrepreneur relief" applies in which case the first £1 million of gains will be taxed at 10%. Thereafter tax will be payable at 18%.

The Entrepreneur relief is a lifetime relief and applies to all gains made after 5th April 2008 but only applies to "business assets". Personal gains are still to be taxed at 18%.

For further details please contact David Hogg or Iain Robson on 01325 466461 or email them: david.hogg@close-thornton.co.uk or iain.robson@close-thornton.co.uk

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