Entrepreneurs’ Relief can be helpful, but it's important to think about the possible dangers before requesting this relief. Risks can include:
Meeting eligibility criteria: The relief is subject to strict requirements. To prevent any problems, it is crucial to fully comprehend and adhere to the HMRC rules.
Lifetime allowance: The amount of qualified profits that are eligible for the lower Capital Gains Tax rate is constrained by a lifetime allowance, which is a condition of the relief. Keep track of your lifetime allowance to make sure you don't go over the allotted amount and forfeit the relief.
Changes in legislation: Each year the UK government may change the conditions for Entrepreneurs’ Relief including adjustments to tax laws and relief programmes. Keeping informed and seeking advice from a qualified adviser will assist you in making plans and navigating future changes.