The asset list that decides whether your gain can be deferred, the mixed use calculation, and the 2025 change that removed holiday lets from the map.
Zazentax Rollover Relief Series, Part 3 of 3 · Updated July 2026 · Reading time: about 6 minutes
Rollover relief, the deferral covered in Parts 1 and 2 of this series, only operates when both the asset sold and the asset bought appear on a specific statutory list. The list is shorter than most business owners assume, and two of its exclusions cause regular disappointment. Furthermore, one entry that appeared in every textbook for decades was removed in April 2025, and plenty of online guidance has not caught up. This final part maps the territory.
What Is on the List, and What Is Not
The assets you will meet in practice are three. Land and buildings occupied and used for the trade come first: the shop, the office, the workshop, the warehouse. Goodwill comes second, meaning the value of a business’s reputation and customer relationships when a trade is sold. Third comes fixed plant and machinery, where the word fixed does the heavy lifting: it means immovable. A printing press bolted into the factory floor can qualify; a tractor, a van or a movable machine cannot, however essential they are to the business. The list also extends to some exotic company: ships, aircraft, hovercraft, satellites and spacecraft all qualify, a reminder that the legislation was drafted with every scale of trade in mind.
Helpfully, the old and new assets do not need to match categories. Selling a building and reinvesting in goodwill, or selling goodwill and buying a workshop, works perfectly well; the relief cares that both ends of the transaction sit on the list, not that they resemble each other.
The most painful absence is shares. Selling shares in your company, or reinvesting sale proceeds into shares, can never support a rollover claim, because a share is a stake in a company rather than an asset used in a trade. Business owners planning an exit through a share sale must therefore look to other reliefs, principally Business Asset Disposal Relief, rather than to rollover. Vehicles and other movable equipment are the second common disappointment, excluded because they are not fixed.
Key point: Since 6 April 2025, furnished holiday lets no longer qualify. The special regime that treated qualifying holiday lettings as a trade was abolished, and with it went access to rollover relief, along with other business reliefs, for these properties. Guidance written before 2025 will tell you otherwise; it is out of date.
Mixed Use: One Building, Two Calculations
Many premises are not wholly business assets. A common arrangement is a building where the trade occupies most of the space and a flat or a floor is let out. The law resolves this by splitting the property into two notional assets, a business part and a non-business part, and only the business part can join the rollover system.
Consider Hana, who bought a building for £220,000 and used 70% of it for her trade, letting the remainder. She sells the whole building for £370,000. The business part shows proceeds of £259,000 against a cost of £154,000, giving a gain of £105,000. The non-business part shows proceeds of £111,000 against a cost of £66,000, giving a gain of £45,000, and that £45,000 is chargeable in full immediately, with no relief available for it whatever she buys next.
Hana then buys new premises, used entirely for the trade, for £248,000. Only the business proceeds of £259,000 enter the comparison, so she has retained £259,000 minus £248,000, which equals £11,000, and that slice of the business gain is taxable now. The remaining £105,000 minus £11,000, which equals £94,000, rolls over, cutting the new base cost to £248,000 minus £94,000, which equals £154,000. Her total immediately chargeable gain is therefore £45,000 plus £11,000, which equals £56,000. The same splitting logic applies on the purchase side: if a replacement building is partly let, only the money spent on its business element counts as reinvestment.
Action required: If your premises include any let or private element, have the business percentage evidenced and agreed before you sell. The split drives both the immediate tax and the relief, and a percentage invented after the event is the first thing an enquiry will test.
Where Business Asset Disposal Relief Fits
One interaction deserves a final word. Business Asset Disposal Relief, usually shortened to BADR, taxes qualifying business disposals at a reduced rate, which for 2026/27 is 18% on gains within a £1 million lifetime allowance. Where a sale qualifies for both reliefs, rollover is applied first and BADR can then apply to whatever gain remains chargeable. Consequently, deferring everything is not automatically wise: a gain taxed today at 18% may be cheaper than the same gain resurfacing years later at the standard 24%. The two reliefs should be chosen together, with a calculation, rather than claimed by reflex.
Key Takeaways
- The practical qualifying assets are land and buildings used in the trade, goodwill, and fixed, meaning immovable, plant and machinery.
- Old and new assets need not be the same type, but both must be on the list.
- Shares never qualify, movable equipment and vehicles never qualify, and furnished holiday lets ceased to qualify from 6 April 2025.
- Mixed use property is split into business and non-business parts; the non-business gain is taxed in full and only business proceeds count as reinvestment.
- Rollover applies before Business Asset Disposal Relief, now at 18%; sometimes paying the reduced rate today beats deferring into a higher rate tomorrow.
Not Sure Your Asset Qualifies?
The list is narrower than it looks, the holiday let change is recent, and mixed use turns one sale into two calculations. Zazentax can confirm what qualifies, agree the business percentage before you sell, and sequence rollover and BADR so you pay the lower lifetime tax.
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