MVLCalculator

The 18% rate

Business Asset Disposal Relief on an MVL in 2026/27

Updated

BADR rose to 18% on 6 April 2026 and still applies to a qualifying MVL distribution.

Talk to a specialist What is left in the company, your share and your other income. The rates come from GOV.UK.

What the liquidator would hand to the shareholders once every creditor, including HMRC, is paid.

Your percentage of the ordinary shares. Each shareholder works out their own figure.

Default: the median entry fee of the four UK insolvency practitioners on this site's fee index (£1,747.50, before VAT and disbursements). Use your own quote.

Usually the nominal value you subscribed, for example £100 for 100 £1 shares.

Salary, pension, rent and interest before your Personal Allowance. It decides which CGT and dividend rates apply.

GOV.UK sets the conditions: at least 5% of the shares and voting rights, and being an officer or employee, for at least 2 years.

GOV.UK: you can claim a total of £1 million in Business Asset Disposal Relief over your lifetime.

Condition C of ITTOIA 2005 section 396B, the rule that can tax a winding-up distribution as income.

What the MVL leaves you after tax

£122,125

Your share of the distribution, after the liquidator's fee£148,253
Your capital gain£148,153
Capital Gains Tax on the distribution£26,127
The same cash taken as a dividend (no liquidator's fee)£150,000
Dividend tax on that cash£53,621
What a dividend leaves you after tax£96,379
How much more the MVL leaves you than a dividend£25,746

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How this calculator works
  • The BADR rate. GOV.UK: Business Asset Disposal Relief means you pay 18% on all gains on qualifying assets disposed of from 6 April 2026 (14% between 6 April 2025 and 5 April 2026). You can claim a total of £1 million over your lifetime; the calculator taxes any gain above what is left of that £1 million at the main rates. (GOV.UK: Business Asset Disposal Relief, how to claim (the £1 million lifetime total))
  • The main CGT rates. GOV.UK lists 18% and 24% for individuals from 6 April 2026, and an annual exempt amount of £3,000 for 2026 to 2027. Following GOV.UK's order, BADR gains use the basic rate band first and the exempt amount is set against the gains that would pay the highest rate. (GOV.UK: Business Asset Disposal Relief, work out your tax)
  • The bands. GOV.UK's Income Tax table for 2026 to 2027: a Personal Allowance of £12,570 that goes down by £1 for every £2 of income above £100,000, a basic rate band of £37,700 and the additional rate above £125,140. Scottish and Welsh Income Tax bands are not applied; CGT and dividend tax use the UK bands everywhere. (GOV.UK: Income Tax rates and allowances, current and past)
  • The dividend comparison. GOV.UK: a dividend allowance of £500, then 10.75% basic rate, 35.75% higher rate and 39.35% additional rate. The comparison counts the tax on the dividend only. When a dividend takes your income past £100,000 the extra Income Tax on your other income from the lost Personal Allowance is not added, so above that level the dividend route costs more than shown. (GOV.UK: how dividends are taxed)
  • Section 396B. A distribution in a winding up is taxed as income if conditions A to D are all met: a 5% interest, a close company, carrying on a similar activity within two years, and a main purpose of reducing Income Tax. The calculator flags condition C from your answer and tests none of the others. (ITTOIA 2005 section 396B: distributions in a winding up)
  • Solvency. An MVL needs the directors' statutory declaration that the company will pay its debts in full, with interest, within a period of no more than 12 months. The calculator assumes the company is solvent and its debts are already paid out of the cash you enter. (Insolvency Act 1986 section 89: declaration of solvency)
  • What is not worked out. One distribution in one tax year, cash only: no distribution in specie, no staged distributions across tax years, no losses, no other gains in the year, no Investors' Relief and no tax for a non-resident shareholder. It is a figure to frame a conversation, not tax advice.

The rate

  • 18% on qualifying gains disposed of from 6 April 2026.
  • 14% between 6 April 2025 and 5 April 2026.
  • 10% on or before 5 April 2025.

Source: GOV.UK: Business Asset Disposal Relief, eligibility

The conditions for shares

GOV.UK: for at least 2 years before the disposal the company must be your personal company, meaning you hold at least 5% of the shares and voting rights, and you must be an officer or employee. If the company has stopped trading, you can still qualify if the disposal is within 3 years.

Source: GOV.UK: Business Asset Disposal Relief, eligibility

The lifetime total

You can claim a total of £1 million in BADR over your lifetime. Gains above what is left are taxed at 18% or 24%.

Source: GOV.UK: Business Asset Disposal Relief, how to claim (the £1 million lifetime total)

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  • Free, and no obligation
  • Read and answered by Joe himself, never passed to a firm or a list
  • No tax or legal advice: a call to frame your options

Sources

This site's own datasets, every figure quoted from its source and dated:

  • The MVL Tax Rules carries 7 published figures read from 4 sources' own pages, from 5 to 39.35 percent, read 28 October 2026.
  • The median published figure in the UK MVL Fee Index is 1,747.50 GBP across 4 sources' own pages (range 1,245 to 4,000 GBP), read 28 October 2026.
  1. GOV.UK: Business Asset Disposal Relief, eligibility
  2. GOV.UK: Business Asset Disposal Relief, how to claim (the £1 million lifetime total)
  3. GOV.UK: Business Asset Disposal Relief, work out your tax
  4. GOV.UK: Capital Gains Tax rates and allowances
  5. GOV.UK: how dividends are taxed
  6. GOV.UK: Income Tax rates and allowances, current and past
  7. GOV.UK policy paper: Income Tax rates for property, savings and dividend income
  8. ITTOIA 2005 section 396B: distributions in a winding up
  9. Insolvency Act 1986 section 89: declaration of solvency

Work out your MVL in a minute

What is left in the company, your share and your other income. The rates come from GOV.UK.

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