CGT changes threaten workers share schemes

Analysts warn thousands of investors in share ownership schemes will be
subject to an 18% tax on profits, an increase of up to 13% on the present rate,
after chancellor Alistair Darling removed taper relief and introduced a flat 18%
capital gains tax (CGT) rate.

CGT relief for
will still leave hundreds of thousands of small investors in
‘save as you earn’ and share option schemes falling into the 18% band for CGT
liability from April 6 this year, The Independent reports.

‘The replacement of the taper relief currently available to investors in
companies (not listed on a stock exchange) would mean that instead of paying an
anticipated 10% tax rate on disposal after three years, this would soar to 18%,’
Jason Hollands of F&C

He said the measure would particularly hit owner-entrepreneurs, who often
rely on share ownership schemes as a way of raising cash for their businesses.

Further reading:

CGT loan note dilemma hits entrepreneurs

Employers bodies unconvinced by CGT relief

story in The Independent

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