Incorporation Relief now requires active claim for business transfers
UKPulse Money Desk
Landlords and business owners transferring a qualifying business to a company on or after 6 April 2026 must now actively claim Section 162 Incorporation Relief through their Self Assessment tax return.
- Section 162 Incorporation Relief no longer applies automatically for transfers completed on or after 6 April 2026.
- Transferors must now claim the relief via their Self Assessment tax return for the tax year of the transfer.
- HMRC expects claimants to provide brief details of the transaction, tax computations, and the type of business transferred.
A notable change has taken effect for landlords and other business owners who transfer a qualifying business to a company. For transfers completed on or after 6 April 2026, Incorporation Relief under Section 162 TCGA 1992 is no longer automatic.
Instead, each relevant transferor is now required to actively claim the relief through their Self Assessment tax return for the tax year in which the transfer occurs. This marks an administrative change, but the underlying relief itself has not been abolished.
HMRC has stated that claimants will need to provide brief details of the incorporation transaction, the relevant tax computations, and the type of business transferred. This new requirement does not apply retrospectively to transfers completed before 6 April 2026.
Why this matters: This change introduces an additional compliance step for business owners seeking Incorporation Relief, requiring greater attention to the claim, supporting calculations, and retained evidence.
What this means for you: If you are a landlord or business owner transferring a qualifying business to a company, you must now actively claim Section 162 Incorporation Relief in your Self Assessment tax return for transfers completed on or after 6 April 2026.