Beavis Morgan LLP’s Post

This is madness. Small businesses will no longer be passed down through families. UK Scraps Business Property Relief.   Business Property Relief (BPR), a tax relief system that previously allowed family-owned businesses to be passed down without inheritance tax (IHT). This policy change, effective April 2026, introduces a 20% IHT on business assets over £1 million.   Key Points of the BPR Changes:   - BPR’s Previous Role: BPR was intended to protect family businesses from IHT, enabling them to be inherited tax-free, preserving businesses and supporting local economies. - New 20% IHT Rate: Under the new policy, family businesses will now face a 20% IHT on business assets exceeding £1 million, ending full tax exemption. - Cash-Flow Challenges for Asset-Rich Businesses: Many family-owned businesses are asset-rich but cash-poor, potentially forcing asset sales to cover tax obligations. - Impact on SMEs and Family Farms: The change threatens the stability of family-run farms and SMEs, especially those deeply rooted in local communities.

I've tried to pull together a super quick budget update focussing on small business owners and investors. Inheritance Tax (IHT) - The IHT threshold remains at £325,000 until 2030. Inherited Pensions to be Taxable: Starting April 2027, pensions inherited upon death will be subject to IHT, making IHT and pension planning even more essential. Capital Gains Tax (CGT) - CGT rates for basic and higher-rate taxpayers rise to 18% and 24%, effective immediately, while rates on additional property sales remain at 18% and 24%. - Business Asset Disposal Relief will increase from the current 10% to 14% in April 2025 and 18% by April 2026. Stamp Duty Land Tax (SDLT) - The SDLT surcharge on additional properties will rise from 3% to 5% from 31 October 2024, adding to upfront costs for second homes and investment properties like BTL. Income Tax and National Insurance -Income tax and NIC thresholds remain frozen until 2027–28. - Employers' NIC will increase to 15% in April 2025, reducing the threshold to £5,000. The employment allowance will increase to £10,500 to offset some of these costs for smaller employers. VAT Changes - The VAT rate remains at 20%, with an additional charge on private school fees and boarding services effective from 1 January 2025. Business Rates - A 40% business rates discount (capped at £110k) will replace the current 75% discount from April 2025. - Private schools in England will lose charitable rate relief from April 2025. Excise Duties and Other Levies - Fuel duty stays frozen, with the 5p cut extended to March 2026. - Alcohol duties will rise with inflation, except for reduced rates on draught products in pubs. - Tobacco duty rates will increase, with a new 22p/ml vaping duty starting in October 2026. Non-dom Regime and Other Key Commitments - The current non-dom regime will be replaced by a residence-based system in April 2025. Other Government Commitments - Capital allowances will be maintained, including full expensing and the £1 million AIA. - Current R&D reliefs will continue. - A new process for tax certainty on major investments will be developed, aiming to support business stability and growth. - A higher rate of interest to be charged on overdue tax payments - Stronger powers were given to HMRC to investigate and the appointment of a COVID fraud commissioner. https://lnkd.in/efqYYtSH

Labour’s potential Capital Gains Tax hike – What does this mean for UK businesses? 🤔 Great to see our very own Tax Partner, Thomas Adcock, featured in the The Independent today. In the article, Tom discusses how the prospect of #GCT rising is driving behaviour, as clients are beginning to rush through transactions to avoid the spectre of potential tax rises and benefit from the perceived lower tax rates of today 💷 He also addresses how non-doms, UK resident and domiciled people have had enough of increased tax rates: “Perhaps what’s more troubling is the number of entrepreneurs, high earners and wealth generators that are choosing now to leave the UK” 🏠 🔗Read more here: https://shorturl.at/wDbAS #Gravita #CapitalGainsTax #Tax #Non-Doms #LabourTaxIncrease #Entrepreneurship ------------------------- 👋 We’re Gravita, we’d love to talk 🙌 Build the future together 🌐 Tech enabled, full-service firm of accountants, with global reach See more from us: 🔔 Click the bell on our profile to be notified of our posts ➕ Make sure you’re following us 📝 Sign up to receive Gravita’s latest updates and webinar invites: https://lnkd.in/ecugk7WR

Working with business owners before the Budget gave alot a people the opportunity to take advantage of planning opportunities which will soon be lost due to the changes that were subsequently announced in the Budget. Check out the first of a series of articles looking at the Inheritance Tax changes announced in the Budget. The first instalment focuses on the impact on business owners. Long story short: 🔻 yes the new rules will be less favourable (to put it nicely) 🔻 yes the additional exposure to tax on death will put pressure on businesses 🎯 there are still opportunities to plan and mitigate the exposure to tax 📆 it will be important to take action before the changes fully kick in on 6 April 2026 🔎planning that has already been put in place - in Wills and in Trusts - will need to be reviewed Business owners will need alot of support in light of the announcements in the Budget. Get in touch to see how we can help if you're feeling a bit lost in the fog of all these changes. https://lnkd.in/eVXy8vcp #InheritanceTax #successionplanning #Budget

🚨 Attention UK Entrepreneurs: Major Tax Proposal Alert! 🚨 In a recent announcement, the British Chancellor has proposed a drastic measure that could significantly impact high-net-worth individuals and entrepreneurs: a doubling of the capital gains tax from 20% to 39%. This is part of a continuing trend where the UK's fiscal policies heavily target the wealthy, akin to the recent changes in Non-Dom amendments. Why should this concern you? 🤔 Such a steep increase in capital gains tax could stifle the entrepreneurial spirit and prompt business leaders to seek out more conducive environments for their ventures. Many are already relocating to tax-neutral jurisdictions like the UAE, which not only offer financial incentives but also greater economic stability amid the UK's shifting tax landscape. If you are a UK entrepreneur concerned about how to preserve and protect your wealth in light of these potential changes, it's critical to consider your options now. 🌍 At Water & Shark Private Client Practice, we specialize in guiding clients through these complex decisions with ease. Whether it involves relocating your business operations or becoming a tax resident in a more favorable jurisdiction, we ensure your assets and future are well protected. 🔍 Curious about how these changes could affect you and what steps you can take? Feel free to reach out to us at legal@waterandshark.com or harsh@waterandshark.com. I am here to personally assist you in navigating these challenging times. #TaxPlanning #Entrepreneurship #CapitalGainsTax #HNWI #UHNWI #WealthManagement #TaxRelocation #WaterAndShark Water & Shark Water & Shark Legal #UKTax #UKinheritancetaxes https://lnkd.in/dfCXtnhu

Voluntary liquidations have soared amid concerns of a shake-up of the capital gains tax regime Thousands of solvent British businesses are shutting down in order to avoid an unexpected increase in levies on entrepreneurs in the budget. The number of members’ voluntary liquidations (MVL) this month doubled for the whole of October last year. According to notices filed in The Gazette, the number of advertised business closures in the country exceeded 1,600. The spike in liquidations comes as Chancellor Rachel Reeves considers cutting a capital gains tax break known as Business Asset Disposal Relief in her upcoming Autumn Budget. #Labourthreat #OAG #capitalgains #TAX #UKBusiness #liquidations #autumnbudget #Labour https://lnkd.in/eXMAekSK

The 2024 Canadian Federal Budget impacts entrepreneurs and investors! Capital gains tax rates are rising, but there are some new incentives to support Canadian businesses. With rates increasing from 50% to 66.7%, effective June 25, 2024, it's crucial for business owners to strategize. Individuals with annual capital gains exceeding $250,000 will face a higher tax rate, but there's also good news. The lifetime capital gains exemption for small business shares or certain properties rises to $1.25 million, benefiting those with eligible gains below $2.25 million. Additionally, a new incentive aims to support Canadian entrepreneurs with reduced tax rates on eligible capital gains, potentially providing a combined exemption of $3.25 million when selling a business. While these changes promote fairness and entrepreneurship, they may increase tax burdens for higher net-worth individuals and business owners. Strategic financial planning is key in navigating these adjustments effectively. #CanadianBudget #CapitalGainsTax https://lnkd.in/gJgNBhf2

[Declaration: I am a card-carrying member of the Labour Party, but that does not mean I support every policy that the executive comes up with. ] Fellow SME owners (family owned and run businesses), why are we not up in arms about these tax changes? It's not just the farmers who are being shafted. It's us too. How on earth does this help UK plc? This needs an urgent re-think. SMEs need not be at all embarrassed about generating wealth so why aren't we protesting? We pay our taxes, innovate and invent, employ people and they in turn pay taxes. This new burden of tax on our businesses simply plays into the hands of private equity who will be busy hoovering up family businesses from 2026 when those inheriting cannot afford to pay the tax. Not all SMEs generate massive profits. 'While family firms braced for the impact, the private equity industry stands to benefit from a lower-than-expected rise in capital gains tax on “carried interest”, the share of profits that bosses make on successful deals. [The Chancellor ought to have seen this coming. Sorry, but she was played by the City.] 'Labour was widely expected to target receipts of more than £500m a year by raising the rate from 18%-28% to a level in line with income tax, up to 45%. Instead, the rate will rise to 32%, raising £300m by 2030. 'In a restaurant near Bond Street, a group of fund managers celebrated their lobbying “coup” over lunch. One told the Guardian they had “pulled off the negotiation of a lifetime”. '“We got them down to 32% and made them feel like they had to be grateful for it,” one said.' Grrrr!

🚀📑 Important Tax Update for Canadians: Bare Trusts & CRA’s 2023 Reporting Requirements 🚨💰 Big news for Canadians managing bare trusts! Just in time for the crunch of tax season, the Canada Revenue Agency (CRA) has announced a significant shift for the 2023 filing year. 🗂️🕒 Here’s What You Need to Know: • Bare Trust Relief: For 2023, Canadians involved with bare trusts won’t need to navigate the complex new tax-reporting requirements…unless you hear directly from the CRA. 📉📝 • Why It Matters: Recent legal changes aimed at increasing transparency around trusts had stirred concerns among taxpayers and professionals alike. The requirements, deemed particularly challenging for bare trusts, prompted this latest CRA move. 🏦💼 • What’s a Bare Trust? It’s a setup where the trustee acts solely on instructions from beneficiaries, often used in informal, family financial arrangements without formal documentation. 📊👨👩👧👦 • Common Uses: From co-signing mortgages to holding accounts for elderly parents, bare trusts play a key role in many Canadians’ financial strategies. This exemption offers a sigh of relief for many! 🏠👵 What This Means for You: If you’re involved in a bare trust, this year’s tax filing just got a bit easier. No need to rush meeting the new, stringent reporting requirements for now—but stay tuned for any direct requests from the CRA. 🌟💡 #TaxAdvice #MoneyManagement #TaxTime #CRAUpdate #FinancialNews #TaxRelief #FinancialPlanning #TaxSeason2023 #TrustFundInsights #EstatePlanning #entrepreneur #realestateinvestor #broker #realestateinvesting #realestateinvestment #propertyinvestment #realtor #mortgage

A fortnight from today, Rachel Reeves will stand up at the Despatch Box and deliver her first Budget. It will not be the one she wishes she could give. Ever since moving into Number 11, the Chancellor has insisted that, far from there being no money left, there’s a whopping black hole of £22 billion in the public finances that needs to be plugged. As such, some spending pledges will have to be put on hold, while taxes will need to increase. Constrained by her manifesto promise not to raise more money from working people, Reeves is scrabbling around for other ways to make up the shortfall. A rise in the rate of capital gains tax looks all but certain. What’s still up for debate is how high it’ll go. According to a report in The Guardian, civil servants have modelled the impact of a 39% rate – meaning earnings from employment and those from capital gains would be taxed roughly equally for higher-rate taxpayers. You might wonder whether this would be such a bad thing. Indeed, at a first glance, it seems strange that there should be a discrepancy at all. One of the key principles of a sound tax system is that it should not be distortive, in the sense that it should not necessarily favour or incentivise one thing over another (unless there’s good reason to, such as taxing negative externalities). However, what might seem logical in theory doesn’t always end up making sense in the real world. A few reasons stand out as particularly damning critiques of aligning tax rates on income and capital gains. ✍️Eamonn Ives https://lnkd.in/eCxk2j9g