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Interaction of Entrepreneurs and Rollover Reliefs

How do the time limits for Entrepreneurs and Rollover Reliefs work together

My client sold a farm on 28/08/2014 realising a substantial gain.

Rollover relief was claimed on the 2015 Tax Return eliminating the gain on the basis that the client was going to purchase a new farm and other qualifying assets for a total in excess of the sale proceeds.  However the client did not reinvest the full proceeds within the time limits, leaving a gain to be taxed.

The question then is, can the remaining gain benefit from a claim for Entrepreneurs Relief?  I understand that this is available (CG64136) but my question is, will it be too late, due to the time limit for making a claim for ER.

The time limit for making a claim for entrepreneurs relief, as I understand it is the normal Self Assessment filing deadline, i.e. by 31 January following the end of the tax year to which the claim relates.  Therefore in this case the time limit was 31 January 2016.

It therefore seems it is too late for the remaining gain to be taxed at 10% and instead the higher rate will apply.  Is this correct?  It seems that if my client had made the claim for ER when filing his 2015 Tax Return he would also have been in time to have made a partial claim for Rollover Relief in respect of the proceeds not reinvested by 28/08/2018 (4 years from the later of the disposal of the old assets or date of reinvestment) and would have received a repayment of CGT leaving that part of the gain still subject to tax, all taxable at the ER rate of 10%.

Is this correct?  Has my client simply made his claims in the wrong order and as such had the result of a substantially higher CGT bill?

I do appreciate any feedback.

 

 

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