New CGT relief for founders

The government is consulting on the introduction of a new founders’ relief. The relief will be introduced from 6 April 2027 and will be based on similar principles to the current BADR requirements.

The government proposes that eligible individual founders of innovative companies will be entitled to a 10% CGT rate on disposals up to a lifetime limit of £10m.

The founder would need to meet the following conditions:

• they have held at least 25% of the ordinary share capital, including voting and capital rights, at the point the trading activity, or preparations to trade, commenced;
• they have held the shares for at least five years prior to disposal; and
• they have been UK resident under the statutory residence test for at least five continuous tax years before the disposal.

The company whose shares are being disposed of will also need to satisfy certain conditions, including with regard to UK residency and growth and innovation.

The relief would be available on all shares, not just the shares held at the time the company started.

Reduction in BADR lifetime limit

With effect for disposals made on or after 6 April 2027, the lifetime limit for business asset disposal relief (BADR) will reduce from £1m to £500,000.

Special provisions will be made for contracts, or share reorganisations, entered into before 6 April 2027 which complete after that date. 

Holdover relief calculations

The government will go ahead with proposals first announced in 2025 to amend the calculation of holdover relief (relief for gifts of business assets) to include intangible assets when working out if there needs to be a restriction of the relief for non-business assets.

Cryptoassets

The government has confirmed that the Finance Bill 2026–27 will introduce legislation to reform the taxation of decentralised finance (DeFi) and eligible stablecoins. 

For DeFi, certain transfers by individuals and trustees into and out of qualifying lending and liquidity pool arrangements will be treated on a ‘no gain, no loss’ basis until an economic disposal occurs, with the changes taking effect from 6 April 2027. 

For eligible stablecoins, the government intends to bring their tax treatment closer to that of money, amending the rules for individuals, trustees and companies, and extending the application of withholding tax. These changes are due to take effect from April 2027.

Budget measures that apply with immediate effect

With effect from 28 October 2026: 

• late filing penalties for the failure to submit a residential property return, ie, within 60 days of completion, will stop accruing from the date the person reports the disposal on their self assessment return;
• the CGT participators rules will be applied to non-UK resident close companies which are protected cell companies; and
• capital payments received under a contract for a loss or surrender of rights under that contract, will be liable to CGT.