Business owners speed up plans to sell amid fears of tax rises in upcoming budget

By Investor Empires On Oct 12, 2024

Growing concerns about tax rises have prompted nearly 30% of UK business owners to accelerate plans to sell their companies, according to new analysis by wealth management firm Evelyn Partners.

The survey, of 500 business owners with revenues of at least £5m, found that 29% of respondents had accelerated their plans to exit their business over the past year, with 23% citing fears of an increase in capital gains tax as key. factor.

These results come as the government continues to hint at raising taxes ahead of the budget on October 30. Labor leader Sir Keir Starmer also suggested that wealthier individuals and companies could face a greater tax burden to help manage the UK’s difficult financial situation.

Laura Hayward, tax partner at Evelyn Partners, said business owners were increasingly “on edge” due to concerns about potential changes to capital gains tax and inheritance tax. She noted that many entrepreneurs are looking to secure the value of their businesses before any unfavorable tax changes take effect.

“The business environment for many owners was already difficult enough in recent years as they worked to rebuild after the pandemic amid cost-of-living pressures and rising inflation,” Hayward said. “Now, with the potential for unfavorable tax changes in the upcoming Budget, it is understandable that some are looking to reap the rewards of their hard work sooner rather than later.”

The analysis also coincides with a decline in business and consumer confidence. The Institute of Directors’ economic confidence index fell sharply from -12 in August to -38 in September, as business leaders expressed concerns about the tax burden. In addition, the GfK Consumer Confidence Index fell from -13 in August to -20 in September, as more people reported less optimistic expectations about their personal finances and the economy in general.

As the Budget approaches, businesses are bracing for potential changes, hoping for clarity on how any new tax measures will impact their plans to grow, invest or sell their businesses.

Jimmy Young

Jamie is an experienced business journalist and senior reporter at Business Matters, with over a decade of experience reporting on UK SME business. Jamie holds a degree in Business Administration and regularly participates in industry conferences and workshops to stay at the forefront of emerging trends. When Jamie is not reporting on the latest business developments, he is passionate about mentoring up-and-coming journalists and entrepreneurs, sharing their wealth of knowledge to inspire the next generation of business leaders.