Clause 48 - Election to forego roll-over relief on transfer of business
Finance Bill
4:45 pm
Mr Howard Flight (Arundel and South Downs, Conservative)
I beg to move amendment No. 65, in page 33, line 11, after 'apply', insert
'to the full gain arising on the incorporation of the business or a proportion thereof as specified in the election'.
We have tabled the amendment to make the election apply only to part of the gain, as suggested by the Institute of Directors. The purpose is to allow people who incorporate their business and then dispose only of some of the shares in a two-year period to disapply incorporation relief on the proportion of the gain arising on the shares disposed, and not on the whole gain. The Chartered Institute of Taxation suggests a
full review of the reliefs available on incorporation, particularly if lots of unincorporated businesses arise; we discussed earlier the issue relating to people choosing to incorporate as a result of the tax advantages of incorporation. If that happens as we anticipate, the whole territory may need more consideration.