Selling a care business before the relief limit falls

The change

HMRC's tax information and impact note, published on 29 October 2026, says the lifetime limit "will be reduced from £1 million to £500,000 for qualifying disposals made on or after 6 April 2027". The change was announced at Budget 2026 and is not yet law. HMRC estimates about 13,000 of roughly 51,000 claimants will be affected.

Who qualifies

For a share sale, the seller must for at least 2 years before the sale be an employee or office holder of a trading company in which they hold at least 5% of the shares and voting rights. The relief rate is 18% for disposals from 6 April 2026. Gains above the lifetime limit are taxed at the normal rates: 24% for higher and additional rate taxpayers.

Contracts signed before April 2027

The note says anti-forestalling rules will apply to unconditional contracts entered into before 6 April 2027 that have not completed by then. Gains under those contracts are subject to the £500,000 limit unless the parties can show they did not enter the contract to obtain a tax advantage.

Registration runs alongside the tax date

A buyer of a care home or nursery that is a new legal entity must be registered with CQC or Ofsted before it provides care, so the registration timetable and the tax date are planned together.

How we help

We work out the tax on the sale, check that the relief conditions are met, and plan the timetable with your solicitor. More on buying or selling a care business.