Latest news with #inheritanceTax
Yahoo
12 hours ago
- Business
- Yahoo
‘I'm a millionaire fleeing Britain – a Reeves U-turn would stop me leaving'
I have a spreadsheet open in front of me on my computer, detailing the exact number of days I have left to stay in the UK this tax year. The reason? Labour's changes to non-doms inheritance tax rules. The changes are so costly that they have forced me to reconsider where I live. When my days in the UK run out, I will not spend time in some tax haven; I'll just go back home to South Africa and work out the next steps. If Rachel Reeves reverses the inheritance tax change for non-doms, I would unequivocally stay and grow my venture capital business in the UK. I know so many other millionaires in my situation. Many have left but still have properties here and have not yet completely settled in their new homes. Half of these people would rush back if the rules around paying inheritance tax on worldwide assets changed, because we are all upset to leave and feel forced. But the Chancellor must act quickly before it is too late. I want to keep investing in growth companies like I did with quantum computing start-up Oxford Ionics, which last week sold for $1.1bn (£820m) to a US firm. But after raising £500m to invest in Britain's most exciting start-ups since I arrived here in 2019, my future investment will now be elsewhere. This money will likely help grow companies in mainland Europe instead. It is a shame, as Oxford and Cambridge are where the most exciting cutting-edge projects are happening. But I am sadly certainly not going to bring any more money to the UK if I cannot stay. I know people will say: 'It's just inheritance tax. What does it matter if you are dead?' My businesses are my life's work. I want them to secure my sons' futures. I grew up with very little, fleeing communist Poland as a child refugee with my parents and two siblings when the country started running out of food in the early 1980s. The only way to get out was to flee with fake papers. We spent the whole of 1981 in a migrant camp in Austria, where my parents applied to countries accepting refugees. We ended up in South Africa without knowing anything about the country or the apartheid regime. We didn't speak English and had $500 to our name. In the next years, we were just about surviving. I studied actuarial science at university because that was the only way to get a bursary, and we had no money for schooling. After working for a couple of insurance companies, I realised I'm not diplomatic enough to be a corporate employee. So I ended up in the world of start-ups and decided to start my own company. I gambled everything on it, putting my house up as collateral. It is today one of South Africa's large financial services groups. I came to the UK for security reasons in 2019, after speaking out against corruption in Jacob Zuma's government and being left fearing for my life. London has become my home. I had hoped to live here for the rest of my life. Being forced to leave for reasons outside my control feels much like grief. The impact goes beyond just my own personal circumstances. I have had to let 12 casual household staff go – gardeners, cleaners, builders. While I still have a venture capital firm, Braavos, in Britain, I will not hire anyone new here. Over time, I may have to think about relocating it. I put my flat in Kensington on the market five months ago, but because so many like me are leaving there are hardly any buyers. I'm considering putting my house that I love up for sale too, but for now I am holding out for a miracle. If there is none, I will be forced to go once my 90 days in Britain this tax year are up. I'm leaving on the strong advice of my tax advisers, as the new rules around inheritance are unworkable for me. For one, South Africa has foreign exchange controls. That means if I were to die under current rules, South Africa may refuse to release the funds to settle a huge inheritance tax bill in Britain. Even ignoring the difficulty of getting the money out, my wealth is mainly held in the form of shares in the financial services company Sygnia, which I founded and built in South Africa. My sons would be forced to sell those shares quickly. If you want to sell anything fast, you'll have to do so with a big discount, which would devalue the company. How can this be good for the economy? If Reeves changes her mind, I would immediately cancel my plans to leave. I could rehire all of my household staff, take my property off the market and focus on raising funds for another investment fund to boost British growth companies. My message to the Chancellor is this: you came into power to fix the economy, so don't destroy growth by putting politics before economics. As told to Eir Nolsøe Broaden your horizons with award-winning British journalism. Try The Telegraph free for 1 month with unlimited access to our award-winning website, exclusive app, money-saving offers and more.
The Independent
a day ago
- Business
- The Independent
Aim boss makes plea to boost market's appeal after inheritance tax blow
The boss of London's junior stock market has called on the Government to help halt an exodus of companies listed in the City as he warned over the impact of its move to cut inheritance tax relief on Aim shares. Marcus Stuttard, head of Aim and UK primary markets at the London Stock Exchange, urged the Government to reinstate 'financial incentives' for Aim investors after last autumn's Budget revealed plans to slash inheritance tax (IHT) relief on Aim-listed stock from 100% to 50% from April next year. Aim has suffered a raft of firms quitting the market in recent years as part of a wider shift away from London towards overseas rivals and as firms are bought out by foreign competitors or taken private. More than 60 firms – with a market cap of over £12 billion – have already announced plans to leave Aim in 2025 as they look to move to the main market, delist or are bought out. As Aim celebrates its 30th anniversary on Thursday, Mr Stuttard told the PA news agency that the Government can help stop the outflow of firms on London's beleaguered market, with 'more companies leaving than joining in the last two years'. He said the cut to IHT relief was a major blow. 'One hundred per cent relief has been and used to be really important to Aim,' he said. 'We are calling on the Government to make sure there's certainty… with financial incentives to support Aim.' He also backed Government plans to increase pension fund investment in UK stocks, saying it was crucial that 'domestic investors back our domestic economy'. He told PA: 'International investors understand the quality of our small businesses – we need our own pension funds to be backing that opportunity. 'It's vital that our UK pension funds back the UK economy.' The Aim – or Alternative Investment Market – was launched in June 1995 to give small and medium-sized firms access to capital. In the 30 years since, it has admitted more than 4,000 companies and raised over £136 billion. There were about 1,700 businesses listed on Aim in 2007, but this has dwindled to fewer than 700. Some of this is down to costs of listing and onerous rules and regulations. Mr Stuttard said the group is working on a discussion paper to ask firms how Aim could change and evolve and what are the current downsides of listing on the market. He said 'nothing is off the table' in terms of what could be looked at, with the market keen to see the consensus for a way forward. He said it is clear there is still a strong need for Aim to help companies get access to capital to grow without resorting to selling. 'From start-up to initial public offering (IPO) to big global business, we want to provide companies with a range of choice of financing options so they don't get sold too early,' according to Mr Stuttard. 'Aim is a really important part of the UK economy and the UK capital markets,' he added.
Bloomberg
2 days ago
- Business
- Bloomberg
UK Inheritance Tax Surge on Rich Was Mistake, Policy Author Says
One of the architects of the UK Labour government's flagship crackdown on the wealthy said it was a 'mistake' to expose non-doms to an immediate 40% inheritance tax on their overseas assets. Arun Advani, director of the independent Centre for the Analysis of Taxation, told Bloomberg News he had recommended staggering the introduction of IHT on the super-rich who live in Britain but are not resident for tax purposes. A gradual approach would have stopped many of them leaving the country, he said.
Telegraph
2 days ago
- Business
- Telegraph
‘I'm a millionaire fleeing Britain – a Reeves U-turn would stop me leaving'
I have a spreadsheet open in front of me on my computer, detailing the exact number of days I have left to stay in the UK this tax year. The reason? Labour's changes to non-doms inheritance tax rules. The changes are so costly that they have forced me to reconsider where I live. When my days in the UK run out, I will not spend time in some tax haven; I'll just go back home to South Africa and work out the next steps. If Rachel Reeves reverses the inheritance tax change for non-doms, I would unequivocally stay and grow my venture capital business in the UK. I know so many other millionaires in my situation. Many have left but still have properties here and have not yet completely settled in their new homes. Half of these people would rush back if the rules around paying inheritance tax on worldwide assets changed, because we are all upset to leave and feel forced. But the Chancellor must act quickly before it is too late. I want to keep investing in growth companies like I did with quantum computing start-up Oxford Ionics, which last week sold for $1.1bn (£820m) to a US firm. But after raising £500m to invest in Britain's most exciting start-ups since I arrived here in 2019, my future investment will now be elsewhere. This money will likely help grow companies in mainland Europe instead. It is a shame, as Oxford and Cambridge are where the most exciting cutting-edge projects are happening. But I am sadly certainly not going to bring any more money to the UK if I cannot stay. Refugee to millionaire I know people will say: 'It's just inheritance tax. What does it matter if you are dead?' My businesses are my life's work. I want them to secure my sons' futures. I grew up with very little, fleeing communist Poland as a child refugee with my parents and two siblings when the country started running out of food in the early 1980s. The only way to get out was to flee with fake papers. We spent the whole of 1981 in a migrant camp in Austria, where my parents applied to countries accepting refugees. We ended up in South Africa without knowing anything about the country or the apartheid regime. We didn't speak English and had $500 to our name. In the next years, we were just about surviving. I studied actuarial science at university because that was the only way to get a bursary, and we had no money for schooling. After working for a couple of insurance companies, I realised I'm not diplomatic enough to be a corporate employee. So I ended up in the world of start-ups and decided to start my own company. I gambled everything on it, putting my house up as collateral. It is today one of South Africa's large financial services groups. I came to the UK for security reasons in 2019, after speaking out against corruption in Jacob Zuma's government and being left fearing for my life. Pushed out London has become my home. I had hoped to live here for the rest of my life. Being forced to leave for reasons outside my control feels much like grief. The impact goes beyond just my own personal circumstances. I have had to let 12 casual household staff go – gardeners, cleaners, builders. While I still have a venture capital firm, Braavos, in Britain, I will not hire anyone new here. Over time, I may have to think about relocating it. I put my flat in Kensington on the market five months ago, but because so many like me are leaving there are hardly any buyers. I'm considering putting my house that I love up for sale too, but for now I am holding out for a miracle. If there is none, I will be forced to go once my 90 days in Britain this tax year are up. I'm leaving on the strong advice of my tax advisers, as the new rules around inheritance are unworkable for me. For one, South Africa has foreign exchange controls. That means if I were to die under current rules, South Africa may refuse to release the funds to settle a huge inheritance tax bill in Britain. Even ignoring the difficulty of getting the money out, my wealth is mainly held in the form of shares in the financial services company Sygnia, which I founded and built in South Africa. My sons would be forced to sell those shares quickly. If you want to sell anything fast, you'll have to do so with a big discount, which would devalue the company. How can this be good for the economy? If Reeves changes her mind, I would immediately cancel my plans to leave. I could rehire all of my household staff, take my property off the market and focus on raising funds for another investment fund to boost British growth companies.
The Independent
2 days ago
- Business
- The Independent
Reeves considers U-turn on non-dom crackdown to halt exodus of wealthy
Rachel Reeves is considering climbing down on her non-dom crackdown to stem the flow of ultra-rich taxpayers leaving the UK. The chancellor is deciding whether to U-turn on the decision to tax non-domiciled individuals inheritance tax based on their global assets. The changes, which formed a key part of Labour's general election campaign, have raised concerns about an exodus of the wealthy as they flee in search of lower taxes. And a senior City figure told the Financial Times 'there will most likely be some tweaks to inheritance tax to stop the non-dom exodus'. Billionaire steel tycoon Lakshmi Mittal is among those said to be considering leaving Britain as a result of the chancellor's changes. A spokesman for the Treasury said: 'The government will continue to work with stakeholders to ensure the new regime is internationally competitive and continues to focus on attracting the best talent and investment to the UK.' The non-dom tax loophole, which lets foreign nationals living in Britain avoid paying tax on overseas earnings, was thrust into the spotlight when The Independent first revealed that Akshata Murty, Rishi Sunak's wife, had used it to save potentially millions of pounds. Ms Murty, whose family business is estimated to be worth around £60bn, later said she would no longer claim the status on her worldwide earnings. At the time, she said she did not want her tax status to be a 'distraction for my husband or to affect my family'. Since Labour came to power in July, the UK has lost a millionaire every 45 minutes, with the exodus driven by Labour's tax grabs and a lack of business confidence. Britain lost a net 10,800 millionaires last year, a 157 per cent increase on 2023, including 78 centi-millionaires (worth at least £100 million) and 12 billionaires. They left for other countries mainly in Europe, such as Italy and Switzerland, as well as the United Arab Emirates. Tax planners have repeatedly warned of an exodus of Britain's super wealthy, with many blaming the impact of Ms Reeves' first Budget in October. And Britain experienced its most significant drop in billionaires ever last year, according to the Sunday Times Rich List. The non-dom regime was replaced by the chancellor with a residency tax under which those living in the UK for more than four years are made to pay income and capital gains tax on overseas earnings. Those who stay long enough also face paying inheritance tax on overseas assets.
