Neil MacGillivray: Business owners beware of potential CGT changes

OTS report

clock • 4 min read

The recommendations that the Office of Tax Simplification (OTS) put forward in its review of capital gains tax (CGT), published on 11 November, has created quite a stir. Neil MacGillivray warns that, if the key proposals are adopted, current CGT planning opportunities may be lost, particularly for owner managed businesses

The OTS report highlights how the CGT rules can distort behaviour and do not meet policy intent, in particular, their interaction with income tax and inheritance tax (IHT). For example, the lower rates of CGT can act as a motivator for owner managed companies to retain accrued income within their company in the hope they can benefit from lower CGT rates on selling or winding up the business. What grabbed the headlines was the key recommendation that CGT rates should be aligned with income tax rates. The closer alignment of rates would reduce the complex rules needed to police the boundar...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on Tax planning

P1 platform to offer Business Relief ahead of pension IHT changes

P1 platform to offer Business Relief ahead of pension IHT changes

Partnership with PXN Investments

Sophia Panayi
clock 15 September 2026 • 3 min read
Predictions and the value of financial advice

Predictions and the value of financial advice

'If there is one profession that has had to become comfortable with uncertainty, it is ours'

Andrew Aldridge
clock 10 September 2026 • 7 min read
Majority of advisers want CGT reporting in platform tax packs

Majority of advisers want CGT reporting in platform tax packs

Some 39% of advice firms cite tax planning as a priority

Sophia Panayi
clock 09 September 2026 • 1 min read