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Entrepreneur's relief second disposal of shares

My client disposed of his holding in his personal company qualifying for Entrepreneur's relief, meeting all the conditions at that time.  he retained a shareholding but ceased to act as a director and ceased any involvement in the running of the business.  He now wishes to dispose of the rest of his shares.  Is there any argument that this second disposal is part of his phased withdrawal from his personal company and therefore qualifes still as associated to the first disposal?  All conditions are met except that he is not an officer or employee.

Thank you


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13th May 2012 11:55

Not in my opinion

Ideally, this point would have been considered at the time of the earlier disposal.

However, the conditions in Ss 169I(5)-(7) are clear in that a sale of shares is only a material disposal (thus eligible for ER) if the company has been the individual's personal company and the individual has been an officer or employee of the company (or a group company) for a period of one year ending on either the date of disposal or a cessation of the business/withdrawal from a trading group not more than three years previously.

Neither do the remaining shares qualify as disposal associated with a material disposal.

In my view, ER isn't available.

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