The Sunday Times quotes Julia Cox on the impact of potential capital gains tax rises on businesses and entrepreneurs
The chancellor is just days away from sending her preliminary budget plans to the Office for Budget Responsibility for it to adjudicate before she finalises what will go into the red box on October 30.
Key decisions are being made, and lobby groups are making last-ditch efforts to get their voices heard. Even before anybody knows exactly what the plan is for CGT, the uncertainty over it since Labour’s election win has sent ructions through the business world.
Under the current rules, anyone selling a business can expect to pay tax at 10 per cent if they are a lower-rate taxpayer, or 20 per cent if they are a higher-rate taxpayer. But, the expectation that CGT could be raised — possibly even as high as the 45 per cent top rate of income tax — has already encouraged some business owners to sell up more quickly than they had planned.
Julia Cox, Private Client Partner, says that in her 30 years as a personal tax and trust lawyer, for the first time she had started to see significant numbers of UK-based business owners consider moving overseas.
The current CGT regime also benefits people selling their shares and many are looking to sell theirs before the new tax rules come in.
Julia is observing an increase in directors selling shares in stock market-listed companies:
I’ve got a client who has built his wealth in a quoted company … but he feels he’s built it in a regime where he was expecting to pay 20 per cent tax. That’s why it matters to him if it goes up.
Read the full piece in The Sunday Times here.
