Is entrepreneurs relief restricted to UK shares / business

[anon123]

Is entrepreneurs relief in any way restricted to a UK business or shares in a UK company?

I am trying to establish whether relief is available on the disposal of an interest in a foreign company. Assume that all other requirements are met, does the fact that it is a foreign company make a difference? Section 169l states that it must be the individual’s personal company which according to Section 169S means a company in which the individual has at least 5% of the ordinary share capital and that gives him the right to exercise at least 5% of the voting rights. Ordinary share capital is defined by S989 ITA 2007.

Some foreign entities do not have ‘ordinary share capital’. We need to look at HMRC Brief 54/07 to determine if the foreign entity has ordinary share capital. If it does, and the other requirements are met, then I assume there is nothing to prevent a claim for relief on the disposal of the shares under S169I(2)(c) – a disposal of assets consisting of shares or securities of a company. If it does not have ordinary share capital then it seems to me that relief cannot be claimed under S169I(2)(c) but would it be possible to claim entrepreneurs relief on some other basis for example the disposal of the whole or part of the business under S169I(2)(a)?

[HMD]

Without doing any more research, I would say ER could potentially apply to anything on which (UK) CGT would be payable. So if the gain would be subject to CGT in the UK, then, provided you meet the other qualifying conditions, then you should be able to claim the ER. I am not aware of any specific exemptions regarding non-UK shares. Others may prove me wrong.....