UK has competitive taxes on entrepreneurs
It is no secret that the UK is a relatively great place to be an entrepreneur. In 2013, the UK was ranked in the top 5 G20 countries to start, grow, and run a business on EY’s Entrepreneurship Barometer, and recent news indicates that this trend will continue. This autumn, the Treasury committed £400m to extend Enterprise Capital Funds (ECF), a government initiative that encourages venture capital investments into SMEs. In addition to ECF, the Treasury guaranteed £500m of new bank lending to small businesses. These programs give up-and-coming business owners greater access to funding to encourage them to set up their headquarters in the UK.
As a further incentive to attract new businesses, entrepreneurs in the UK are liable for less capital gains tax on selling their business than in other European countries like Germany, France, and Ireland. That is, they pay less tax on the profits gained from the sale of their business. This is because sole traders and partnerships selling their businesses in the UK may qualify for Entrepreneur’s Relief on some or all of the profit made from the sale. Any profit eligible for Entrepreneurs’ Relief will be taxed at 10% instead of the typical rate of 18% or 28%. For example, UK entrepreneurs selling their business for £6.65m would only pay approximately £600,000 in capital gains taxes, which is roughly £2.26m less than in Germany, around £1.53m less than in France and about £1.4m less than in Ireland. To find out further benefits of being an entrepreneur in the UK, please feel free to contact us at 020 7488 3614 or firstname.lastname@example.org.