Labour’s autumn budget is scheduled for Wednesday 30 October and the chancellor, Rachel Reeves, has already warned of ‘tough decisions’ to plug a £22 billion ‘black hole’ in public finances.
The messaging so far is, in order to achieve that, we will need to brace ourselves for tax rises. Nobody likes to be told that they will be having to dish out more of their hard earned to HMRC than they already are, but it is the potential rise in capital gains tax that appears to have spooked many business owners.
This was highlighted to me first by my own accountant, who told me that he had been instructed by a number of his other clients to wind down their firms specifically because of the anticipated changes to capital gains in Labour’s first budget.
These are predominantly from older business owners who have decided that it would simply be better for them to wind down their companies now, embrace retirement and spend more time at the golf club.
The impact of a capital gains hike has also been underlined by a recent survey of business owners with turnovers of at least £5million. That revealed 29% have accelerated plans for selling their companies over the past year and 23% had acted because of concerns about higher capital gains tax and also inheritance tax.
It’s been a tough few years for business owners, including those operating in the fenestration sector, so will we see an exodus of glazing firms – or business owners – or a further consolidation of companies in the coming months?
Perhaps from those who had already earmarked their exit in the next five years, but are now considering whether it is worth the hassle to keep going?
I put the question to Insight Data’s commercial director, Alex Tremlett, and you can read his comment in this week’s newsletter here.
Businesses sell up ahead of tax rises
Labour’s autumn budget is scheduled for Wednesday 30 October and the chancellor, Rachel Reeves, has already warned of ‘tough decisions’ to plug a £22 billion ‘black hole’ in public finances.
The messaging so far is, in order to achieve that, we will need to brace ourselves for tax rises. Nobody likes to be told that they will be having to dish out more of their hard earned to HMRC than they already are, but it is the potential rise in capital gains tax that appears to have spooked many business owners.
This was highlighted to me first by my own accountant, who told me that he had been instructed by a number of his other clients to wind down their firms specifically because of the anticipated changes to capital gains in Labour’s first budget.
These are predominantly from older business owners who have decided that it would simply be better for them to wind down their companies now, embrace retirement and spend more time at the golf club.
The impact of a capital gains hike has also been underlined by a recent survey of business owners with turnovers of at least £5million. That revealed 29% have accelerated plans for selling their companies over the past year and 23% had acted because of concerns about higher capital gains tax and also inheritance tax.
It’s been a tough few years for business owners, including those operating in the fenestration sector, so will we see an exodus of glazing firms – or business owners – or a further consolidation of companies in the coming months?
Perhaps from those who had already earmarked their exit in the next five years, but are now considering whether it is worth the hassle to keep going?
I put the question to Insight Data’s commercial director, Alex Tremlett, and you can read his comment in this week’s newsletter here.
Glass Times
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