Investors can leverage this lower rate of CGT to minimise tax arisng on seed capital investments and business owners can avail of this relief on sale or exit.
However, the €1m threshold is a life-time limit. The 10% rate therefore favours small business entrepreneurs and is of little benefit to shareholders and investors in medium and large businesses.
Individuals with interests in more than one business are particularly disadvantaged.
Higher rate CGT can be deferred by structuring investment through an Irish Personal Holding Company (“"Irish personal holding company"”).
"Irish personal holding company"s are exempt from companies CGT on disposals of shares in a qualifying subsidiary. The exemption also applies to gains arising on the disposal of assets related to shares, such as options and convertible securities