UK tax changes hit business owners
New research from professional services firm S&W, which polled 500 UK business owners, has revealed that more than four in ten (44%) of those working towards an exit have postponed their plans over the last year.
Significantly, almost as many have brought their exit forward (41%). Only 15% say their timescales remain unchanged.
The research shows that a sizeable number who have fast-tracked exits have done so over worries about tax changes. S&W’s poll found 28% of those who had accelerated their exits did so because of cuts to business property relief due to take effect from April 2026.
This could make it more costly to pass businesses on to the next generation. Meanwhile, 20% of those surveyed who accelerated exits were worried about a potential increase in CGT rates in a future Budget.
“The split between those who have brought forward their exit strategy and those who postponed it may not be as odd as it first appears,” said Mark Brockway (Corporate Finance Partner at S&W)
Much will depend on owners’ timescales and their optimism or otherwise about the future. For some, the economic uncertainty resulting from both domestic and international issues – and its impact on valuations – is an obvious motivation to delay, he said.
“However, for other owners, perhaps having already delayed an exit to give time to recover from the pandemic, a further wait does not appeal. With significant challenges facing the UK and global economy, and no easy answers, some may reasonably conclude that a delay won’t necessarily bring an improvement.
“Many businesses thinking of selling are attractive to buyers, with many sectors seeing consolidation. Those owners thinking it’s now or never for a sale can take advantage,” he said.
Eyes on the Autumn Budget
The research shows that many business owners working towards an exit have fast-tracked plans because of unfavourable tax changes already announced or others they fear might come in the future.
Many businesses have had a tough time in recent years, and, understandably, some owners are hoping to realise the gains of their successes sooner rather than later, said Laura Hayward (Tax Partner at S&W).
“Business property relief plays a huge role in helping family businesses pass from generation to generation. Businesses urgently need to review their plans before next April.
“Furthermore, we know from talking to business owners that many have considerable worries that taxes could be increased further in the Autumn Budget to pay for the government’s spending commitments given the gaps in UK public finances.”
“The findings again highlight business owners’ interwoven professional and personal lives and finances, and the complexity and unpredictability this brings, said Haywood.
“The need for flexibility – and advice and support – to navigate this challenge has rarely been greater. It will be essential if UK businesses are to be ready for the next opportunity when it comes along.”
