Business Asset Disposal Relief rates to increase from April 2026. What this means for an MVL

Changes to Business Asset Disposal Relief (BADR) were announced in the 2024 Autumn Budget. The rate increased in April 2025 and will do so again in April 2026.

• BADR rate increase, 2025:
  10% to 14%
• BADR rate increase, from April 2026:
  14% to 18%

If you’re a company director considering a solvent Members Voluntary Liquidation (MVL), you may worry that these changes will negate BADR’s potential benefits.

Depending on your company’s circumstances, it may be beneficial to explore an MVL before the rates increase.

How will the BADR increase impact an MVL?

The upcoming increase means that you could pay more Capital Gains Tax (CGT) on the capital distribution to shareholders after the company’s liquidation.

If you’re considering placing your company into an MVL because of the April 2026 BADR rate increase, starting the process earlier can help ensure timings are properly considered. Speaking to us at an early stage can provide clarity on what’s involved and the process’ relevant timescales.

How much does an MVL cost?

The costs of an MVL can vary depending on your company’s circumstances, including the volume of its assets and its liabilities.

Our current prices for an MVL are as follows:

• £995 MVL – Cash at bank/director’s loan account
  For straightforward solvent closures. Includes in-specie (“day-1”) distribution of company funds in accordance with the company shareholding. Does not include handling creditor payments or physical distribution of company funds. Shareholders should withdraw the cash prior to liquidation in line with their shareholding.
  Best for: clean balance sheet; no creditors; only cash at bank or director’s loan account; no HMRC refunds.

• £3,995 MVL – Creditor payments included
  Everything in £1,995, plus the credit balance on the company bank account, will be transferred to the client account for the liquidation, and a physical cash distribution will be declared. Also includes payment of creditor claims (incl. statutory interest, where required).
  Best for: routine payment of outstanding company liabilities or for those who would prefer a cash distribution over the in specie process.

• £4,495 MVL – CT/VAT refunds included
  Everything in £3,995, plus we claim and receive Corporation Tax and VAT refunds due to the company.
  Best for: CT/VAT refunds to recover.

• Bespoke MVL – Additional services as required
  Tailored support. Includes everything in £4,495, plus Section 455 refunds, HMRC enquiries/investigations, disputed claims, active pension schemes, title transfers for property/shares/investments in specie, asset realisations, and Section 110 reorganisations.
  Best for: property or shares to distribute; physical asset realisations; HMRC enquiries; disputed claims; active pensions, or a Section 110 split.

Shareholder note: Where there are more than three shareholders to receive a distribution, an additional £100 + VAT per additional shareholder is added to the liquidators’ fee.

All tiers include the option for an in-specie distribution of company funds (a potential “day-1” distribution), subject to a final corporation tax return being provided.

How we can place your company into an MVL

If you want advice around entering an MVL, whether that’s because you’re looking to place your company into liquidation before the changes affect the amount of BADR you may receive, or are planning to liquidate your company in the future and want more information as to how these changes will affect you, speak to us.

1. Speak with our initial advisers
   Contact our team via phone, filling in a form, or via our online chat. If we can help, we will arrange a free consultation with one of our consultants to discuss your situation in more depth.
2. Initial assessment
   During the consultation, we will advise if an MVL is the most appropriate route forward for your company or whether alternative options are available.
3. Formally engage with Wilson Field
   If an MVL is appropriate for your company, we will confirm the necessary steps to place your company into liquidation and will issue you with the relevant documentation for you to formally engage us.

Summary

From April 2026, BADR rates will increase from 14% to 18%, potentially impacting the benefits of putting a solvent limited company into a tax-efficient MVL.

If you want to liquidate your solvent limited company before the rates increase, or you want more information before planning for a potential future liquidation, speak to us. We can discuss timescales and outline what information we’ll need to begin the process.