BADR Changes from April 2026: What Security Business Owners Should Know

Business Asset Disposal Relief, formerly known as Entrepreneurs' Relief, provides a reduced rate of Capital Gains Tax on qualifying gains when you sell a qualifying business. For security business owners weighing an exit, the recent change to the BADR rate is worth understanding in practical terms.

I want to be clear upfront: this article provides general context, not tax advice. Before making any decision with tax implications, you should take independent advice from a qualified tax adviser or accountant who understands your specific circumstances.

What Has Changed and When

The BADR rate on qualifying gains was 10% until April 2025. It rose to 14% from 6 April 2025, and it rose again to 18% from 6 April 2026. The standard CGT rate for higher and additional rate taxpayers sits above this, so BADR still provides a meaningful relief even at the higher rate.

The lifetime limit on which BADR can be claimed is unchanged at £1m of qualifying gains. With the rate now at 18%, the maximum tax saving on a £1m gain has fallen to around £60,000 compared with the standard rate. On a gain of any size, the difference between the old and new rates is material in cash terms, which is why timing has been a live question for owners considering a sale.

Anti-Forestalling and Why Timing Still Matters

It is worth being aware that the change came with anti-forestalling rules. In broad terms, these mean that simply signing a contract before a deadline does not lock in the older, lower rate if the deal actually completes afterwards. The result is that you cannot game the rate by exchanging early and completing later, and the date a sale genuinely completes is what governs the rate that applies.

For an owner, the practical takeaway is that the rate question is best treated as one input into a properly run sale, rather than a reason to engineer the paperwork around a deadline. Your accountant can confirm exactly how the rules apply to your circumstances.

Does Your Sale Qualify for BADR

BADR applies to gains from selling all or part of a qualifying trading business, or shares in a qualifying company. There are conditions around how long you have owned the business, your involvement in it, and the nature of the business itself. For many owner-managed security businesses, whether guarding, electronic systems, or monitoring, these conditions are likely to be met, but your accountant should confirm your specific position before you rely on it.

Gains above the £1m lifetime limit are taxed at the standard CGT rate, so the relief is most valuable on the first part of a larger gain.

What This Means for Timing

A well-run sale process takes a number of months from first conversation to legal completion, and the exact timeline varies with the complexity of the business, the due diligence involved, and how quickly buyer and seller move through the legal stages. The point is that an exit is rarely something that can be arranged at short notice, so owners who want any particular tax year to be relevant need to be having conversations well ahead of time.

None of this is a reason to rush a sale that is not ready. Completing a poorly prepared transaction to hit a date, only to accept a lower price because due diligence surfaced avoidable problems, would almost certainly cost more than any tax saved. The right approach is to assess honestly whether the business is ready, and if it is, to move with purpose.

A Practical Perspective

The BADR change is a genuine factor for owners who are already close to a decision. It is not, on its own, a reason to sell a business you are not ready to sell. But if you have been considering an exit in the next year or two, the timing question is worth examining carefully alongside the current strength of the security acquisition market, where private-equity-backed buyers have been consolidating actively.

For owners who want to understand both the tax implications and current market conditions, the best starting point is a confidential conversation that covers both. We can advise on market and valuation; your accountant can advise on the tax position. Between those two inputs, you will have a clear picture of what a sale in the near term would mean for you.