CGT entrepreneurs’ relief is available when owners of trading companies sell their shares, provided certain conditions are satisfied for the 12 months prior to sale. One condition is that the individual has 5% voting control, but a further condition is that they are an officer or employee of the company.
There have been a number of recent cases testing the Court’s interpretation of the meaning of being an officer or employee, with some fortunate results where directors had recently resigned. The safest way to avoid the risk of losing this valuable relief would be to continue to be an officer of the company or remain on the payroll up to the date of the sale.