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taper relief


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A relief applied in computing the capital gains tax charge on a capital gain made on or after 6 April 1998. For a disposal of a non-business asset, taper relief reduces the chargeable gain by 5% for each whole year for which the asset has been held in excess of two years. The maximum reduction available is 40%. For the disposal of a business asset, taper relief reduces the chargeable gain by 50% if the asset has been held for 12 to 24 months and by 75% if the asset has been held for more than 24 months. Taper relief is not applied to the computation of a gain made by a company; in such cases indexation is applied.

Subjects: Financial Institutions and Services.


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