Business Asset Rollover Relief

Description

Lets a trading business defer Capital Gains Tax when it sells a business asset and reinvests the proceeds in a replacement — you pay nothing until you eventually sell the new asset, rather than being taxed on a gain you've immediately ploughed back in. Qualifying assets are land and buildings and fixed plant or machinery (a printing press, for example), and both the old and new assets must be used only for trading, with the business trading at the time of both the sale and the purchase. You have to buy the replacement within 3 years of disposing of the old asset (or up to one year before it), and the claim itself must be made within 4 years of the end of the tax year in which you bought the new asset — or sold the old one, if that came later. For a depreciating asset the deferral runs for up to 10 years rather than indefinitely.

Eligibility summary

• Available across the whole UK (England, Scotland, Wales, and Northern Ireland).
• Applicant must be a registered business.

Notes

Relief on a depreciating asset defers the gain for up to 10 years only. Provisional relief can be claimed if you intend to reinvest but haven't yet, lasting up to 3 years from the 31 January following the tax year of disposal. This defers tax rather than cancelling it — contrast Business Asset Disposal Relief, which reduces the rate on a final exit.

Time limits

Buy the new asset within 3 years after (or up to 1 year before) disposing of the old one; claim within 4 years of the end of the tax year in which you bought the new asset, or sold the old one if later.

Requirement

Your business must be trading when you sell the old assets and buy the new ones, and both assets must be used only for trading.

Qualifying assets

Land and buildings, and fixed plant or machinery.