Capital Gains Tax Changes
In the annual Budget delivered on 28 October 2026, Chancellor John Healey announced a new lifetime founders' relief of 10% on capital gains tax, allowing business founders to save up to £10m in tax bills from company asset sales. At the same time, the threshold for capital gains eligible for business asset disposal relief has been halved from £1m to £500,000. Additional pro-business measures include a young entrepreneurs allowance to cover a year of living costs for young founders and an increase in the tax-free trading allowance for new ventures from £1,000 to £3,000. These changes are scheduled to take effect from 6 April 2027. The chancellor rejected calls from cabinet ministers to raise capital gains tax rates on second homes, shares and other assets due to concerns over wealthy individuals leaving the country or deferring asset sales.