Budget 2020: Changes to Entrepreneurs’ Relief unlikely to disrupt M&A activity
Changes to Entrepreneurs’ Relief unlikely to disrupt
Commenting on the announcement in today’s Budget that Entrepreneurs’ Relief (ER), has been reviewed to reduce the £10 million lifetime allowance to £1million, Jonathan Boyers, head of M&A for KPMG in the UK, said.
“Today’s changes to Entrepreneur’s Relief signals that the Government is shifting its tax policy focus from the end to the beginning of the entrepreneur’s journey, all with the purpose of incentivising innovation and business investment.
“For those business owners who were looking to exit over the weeks and months ahead, it is unlikely that today’s announcement will see them dramatically alter their plans – after all, they will still be paying a reduced rate of capital gains tax. Instead, they will be more focussed on whether the anticipated disruption caused by Covid-19 and associated volatility on the stock markets will be significant enough to disrupt underlying trading performance, and therefore affect the appetite of trade and private equity buyers.”
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