Autumn Budget 2025
Until now, business owners selling shares as part of a qualifying disposal to an EOT could benefit from 100% capital gains tax (CGT) relief, meaning no CGT was payable on disposals.
Effective immediately, this relief has been reduced to 50%. Under the new rules:
- 50% of the gain on disposal to EOT trustees will now be treated as a chargeable gain for CGT purposes.
- The remaining 50% will be deferred and only taxed when the EOT trustees dispose of the shares in the future.
This equates to an effective rate of 12% CGT. If the shares would otherwise qualify for business asset disposal relief, that is ignored and the effective rate of 12% still applies.
The government estimates that this change will bring £6.8 billion of chargeable gains into scope for CGT in the first full year (2026/27).
