There are some changes coming to Capital Gains Tax Retirement Relief in 2025 that we want to make you aware of.

These changes relate to the threshold exemptions for disposal of qualifying business assets.

Disposal to Third Party Prior to 31/12/24

Age 55 – 65  –     750,000

Aged over 65 –  500,000

Changes from 01/01/25

Age 55 – 70                        750,000

Aged over 70                      500,000

• Individuals aged 66 – 69 now have a higher threshold of 750,000

Disposal to Child prior to 31/12/24

Age 55 – 65  –     no upper limit

Aged over 65 –  3,000,000

Changes from 01/01/25

Age 55 – 70                        10,000,000

Aged over 70                      3,000,000

• A limit of €10 million applies to the value of business assets that family business owners aged between 55 and 69 will be able pass free of CGT to their children.
• The €3 million cap will now apply from age 70 upwards – instead of 66

Should I take Action?

Obviously it would be opportune to review your client’s situation in case they would be adversely affected by the new rules.

Example

You are a 58 year old owner of a trading company worth €20 million:

• You wish to pass the business to your children
• You meet the requirements for the relief

If you transfer now all the proceeds would be exempt from CGT

After 01/01/25 – €10 million would be taxable @ 33% = €3.3 million

Perhaps now would be a good time for practitioners to examine their client base to establish whether any action is needed. Please reach out for further information.