Business asset disposal relief (BADR) (previously known as entrepreneur’s relief) meaning

business asset disposal relief (BADR) is a UK capital gains tax relief that, when the statutory conditions are met, charges gains on qualifying business disposals at 10% up to a £1 million lifetime limit. Used on exits, it commonly applies to the sale of: (1) all or part of a sole trade or partnership business; (2) shares or securities in a trading “personal company” by an officer or employee; and (3) “associated disposals” of owned assets used in a partnership or company business on withdrawal. The regime is set out in TCGA 1992 ss 169H–169S and applies uniformly in England and Wales, Scotland and Northern Ireland. It was called Entrepreneurs’ Relief for tax years before 2020–21. Only individuals (and, in certain cases, trustees of settlements where a qualifying beneficiary meets the tests) can claim; companies cannot. Key conditions include a two‑year qualifying period before disposal and, for share disposals, the 5% “personal company” tests (with specific statutory relaxations, e.g. for EMI options). Gains above the lifetime limit are charged at CGT rates. In Ireland, a separate statutory “Entrepreneur Relief” (TCA 1997 s597AA) applies at 10% up to a €1 million lifetime limit; the term BADR is not used.