03: Capital gains

A company’s capital gains are subject to corporation tax in full. Capital losses are set against gains of the same period and the balance is carried forward against future gains. Rollover relief can defer gains where business assets are replaced.

Unlike individuals, companies do not receive taper relief but continue to receive an indexation allowance, which uplifts the cost of the asset by reference to inflation.

Qualifying disposals of substantial shareholdings – at least 10% of the company in which shares are being sold – are exempt from tax. The vendor and the company being sold must satisfy a trading condition and the vendor must have owned the shares for at least 12 months.