She owned half the company. One line on a 2015 form said her shares had no vote, and it cost her £46,260 when she sold

No. If your shares carry no vote at a general meeting, the sale of them does not get Business Asset Disposal Relief, however much of the company you own. A tax tribunal said so again on 9 September 2026, and the case is worth five minutes of your time because of how ordinary it is. Two people ran a small firm. One of them held half the shares. A form filed at Companies House in 2015 described her shares as having "no voting rights". She says nobody meant that. It did not matter. When she sold, HMRC took the relief away and she paid £46,260 more tax. At today's rates the same mistake would still cost her about £27,750.

What happened

In 2015 a small architecture practice issued new shares. The founder got 99 more ordinary shares, taking him to 100. His co-director got 100 shares labelled "B". On paper, that made them equal owners.

The form sent to Companies House to record the new shares, an SH01, described them like this: "Ordinary B shares have no voting rights and no rights to any distribution made on the winding up of the company." Every confirmation statement after that repeated it. The register of people with significant control said the founder held 75% or more of the votes.

In October 2020 she sold her B shares to him for £475,000. She reported a gain of £474,900 and claimed Business Asset Disposal Relief (BADR) on £462,600 of it. HMRC opened an enquiry in 2022, refused the relief in November 2023, and she appealed.

Her case was reasonable on its face. The company had never changed its standard articles of association, which say nothing about B shares having fewer rights. Both shareholders, she said, always treated each other as equals. The filings were an accountant's error.

The tribunal dismissed the appeal. The register and the filings are evidence of what rights shares carry, and it takes "cogent evidence" to beat them. She had none: no board minutes, no written resolutions, nothing showing she had ever voted. She had been advised to get the records corrected and had not done it.

The rule she fell foul of

BADR lets you pay a lower rate of Capital Gains Tax when you sell a trading business or shares in one. On shares, the company has to be your "personal company" for the whole two years before the sale. HMRC's guidance puts that as holding at least 5% of both:

• the shares, and
• the voting rights,

plus at least 5% of either the profits and assets on a winding up, or the proceeds if the whole company is sold. You also have to be an officer or employee of the company across those two years.

The vote the law cares about is a vote at a general meeting of the company. The tribunal was clear that a vote only inside a meeting of B shareholders does not count.

So owning half the company was not the test. Being able to vote with 5% of it was.

What it would cost you at today's rates

From 6 April 2026, a gain that qualifies for BADR is taxed at 18%. A gain that does not, for a higher or additional rate taxpayer, is taxed at 24%. You can claim BADR on up to £1 million of gains across your lifetime.

• On the £462,600 she claimed, the gap today would be 6% of that, about £27,756. Hers was bigger because in 2020/21 the rates were 10% and 20%.
• On a full £1 million of qualifying gains, 6 points is £60,000.

A smaller example. Say you and your partner own a salon company. You hold 100 ordinary shares; your partner holds 100 B shares set up years ago so dividends could be split. You sell, and your partner's gain is £200,000. After the £3,000 annual allowance, BADR at 18% means £35,460 of tax. If the B shares turn out to have no vote, and your partner pays at 24%, it is £47,280. That is £11,820 of your sale price gone because of the wording on a share class.

For most owners the sale is the biggest single payout the business ever makes. This is profit you have already earned, lost at the last step.

Check yours in ten minutes

You do not need an accountant for the first look. Search your company on the free Companies House service and open the filing history.

• The SH01 forms. Every time shares were issued there should be one. Each class has a box describing its rights. Read the words for any class you or a co-owner hold. "No voting rights" means what it says.
• The confirmation statements. They list the share classes and who holds them. In this case they matched the SH01 year after year, which is a big part of why her version of events could not win.
• The people with significant control entry. If it says one person holds 75% or more of the voting rights, and you thought the votes were shared, that is a conflict HMRC will find.

Then look at your own records. The tribunal specifically noted there was no written resolution or minutes showing she had voted. If you have minutes of general meetings, or written resolutions that you signed as a shareholder, find them now.

If the paperwork is wrong

There are two very different situations.

The filings are a mistake and your articles and records back you. Get a company solicitor to correct them. Correcting what a share class says can need the consent of the holders of that class, and if the register itself is wrong, fixing it can mean asking a court to rectify it. Do it before a buyer's lawyer reads the same file in due diligence, because they will.

The shares really were set up without votes. Then the fix is to change the rights, normally by resolution of the shareholders, and file the change properly. That is a real change of control, so the other owners have to agree to it. It also only starts the clock: the two-year test is judged on the two years before the sale. A fix made today protects a sale in autumn 2028, not one next spring.

One honest limit: this is a first-tier decision. It does not bind other tribunals, and the appeal window was still open when it was released. But it shows exactly which documents HMRC reached for first, and in what order.

Who this is most likely to catch

• A spouse or partner given B, C or D shares for dividend splitting, sometimes called alphabet shares. They are often set up with no votes so that control stays put. Those shares can be fine for income tax and fail BADR at the exit. The spouse also needs to be an officer or employee for the two years.
• A manager or head stylist given a slice to keep them. A common way to do it is shares that pay dividends but carry no vote. If the plan is that they keep the stake until a sale, check whether they actually get the relief they were promised.
• A co-founder who stepped down as a director. She resigned as a director in 2017 but stayed an employee, which kept her in the officer-or-employee test. The vote was the only thing missing. Resigning completely would have been a second problem.

When you come to sell

A buyer is not paying for your share structure, but their lawyer will read it, and a messy cap table (the record of who owns which shares with which rights) is one of the things that slows a deal and moves money into retentions or warranties. The owner whose SH01s, confirmation statements and minutes all say the same thing is easier to buy from. That is part of being exit ready, and it costs a morning, not a restructure.