Do I Qualify for
Entrepreneur relief ?

Entrepreneur Relief is a capital gains tax break that allows an individual (referred to as the “disponer”) to pay tax on gains at a lower rate of 10% rather than the standard rate of 33% on qualified business assets.

Any person’s lifetime gains up to €1 million are eligible for this exemption.

Entrepreneur Relief is extremely useful to entrepreneurs at all phases of their careers who want to sell eligible firm assets up to a lifetime limit of €1 million. It enables the tax-efficient extraction of funds from a firm for either personal use or reinvestment in a new business endeavour.

  1. You must be a qualifying individual. This means you must be a sole trader, a partner in a business partnership, or an individual who has owned at least 5% of the ordinary shares of a company for a continuous period of 3 years before the date of disposal.
  2. You must have been involved in the business for a continuous period of at least 3 years before the date of disposal.
  3. You must have disposed of your business on or after 1 January 2016 and before 1 January 2024.
  4. The value of the qualifying business assets must not exceed €6 million.
  5. You must have been resident in Ireland or in the European Economic Area (EEA) for at least three of the five tax years before the date of disposal.
  6. You must have paid any tax due in respect of the relevant gain.

There are two Capital Gain Tax (CGT) periods for revenue:

from January 1 to November 30, “initial period”
between December 1 and December 31, “Later period”
If the gain is in the first phase, the CGT payment is due by December 15 of the same tax year.

The CGT payment for gains in the later period is due by 31 January of the subsequent tax year.

The disposer’s personal tax return, Form 11, for that tax year also contains information about the gain (but not payment).

For more information on your personal tax situation, we recommend that you get in touch or talk to our Client Services Team for advice on how we may help.

call us on +353 (0)1 442 8230, 00353 851477625 or email moh@tasconsulting.ie