Call to scrap entrepreneurs’ tax relief

A tax relief for entrepreneurs should be scrapped and the money diverted into supporting start-ups and those firms looking to grow, says an accounting body. Entrepreneurs Relief enables business owners to pay a reduced 10% rate of capital gains tax on all gains on qualifying assets, rather than the standard 20% rate.

The Association of Accounting Technicians (AAT) says it has numerous shortcomings and wants it abolished. AAT, a professional body with over 140,000 members – including 4,250 licensed accountants serving more than 400,000 British SMEs – has urged the Government to scrap ER on numerous occasions over the last three years. Some supporters of the relief say it encourages investment, but the AAT points to HMRC commissioned research in 2017 indicating that 92% of claimants were not influenced to invest after receiving it.

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