"Startup Coalition urges Chancellor to reject 'Exit Tax'"

In a move welcomed across the startup and venture ecosystem, the Chancellor has ruled out introducing a founder exit tax in the upcoming budget. The proposal, which had raised concerns about its potential impact on entrepreneurial activity and investment, will not be pursued. This decision preserves the UK's competitive edge for founders and early-stage investors, particularly at a time when global capital is increasingly mobile and sensitive to policy signals. Key implications: • No additional tax on founder equity exits • Reinforces UK positioning as a founder-friendly jurisdiction • Provides clarity for long-term planning and liquidity events In a climate where policy stability is as valuable as capital, this announcement offers reassurance to those building and backing the next generation of UK innovation. https://lnkd.in/dnuekM9d #UKTech #StartupPolicy #FounderFriendly #VentureCapital #AutumnStatement #CapitalGains #PolicyClarity #InnovationEconomy

Over the last week, there’s been growing concern across the startup community about the idea of a potential “exit tax” for founders leaving the UK. An open letter led by the Startup Coalition (with already over 1000 signatures), calls on the Government to rule out a proposed exit tax that risks discouraging global founders from building here and pushing homegrown startups to leave too soon. ✍️ You can read and sign the open letter here: https://lnkd.in/ex3z8f_9. Shout out to Harry Stebbings for bringing it to my attention. --- The UK’s strength has always come from founders who build despite the system, and it’s time policy caught up and proved we still back our own builders. Not by adding barriers, but by strengthening what already works: EIS and SEIS, EMI reform, and unlocking pension capital for UK innovation. That’s what my co-founder Matt Thomas explores in his latest piece: What founders should be asking for from the November Budget. If we want Britain to be a leading place to start and scale companies, founders need belief, and the right environment to build it. 👉 Read Matt’s article here: https://lnkd.in/exeDHmPV

🚀 150 Business Leaders Push Back on the UK’s Proposed Exit Tax, What’s at Stake for Startups and Jobs? More than 150 business leaders have now voiced concern over the UK’s proposed “exit tax”, warning that taxing unrealised capital gains when founders or investors move abroad could drive talent and investment elsewhere. Critics argue that the policy risks undermining the UK’s already fragile tech ecosystem, especially at a time when founders can easily choose to scale in Dublin, Amsterdam, or Dubai, where rules are more predictable and founder-friendly. 📊 What’s the concern? The Treasury reportedly expects the measure could raise around £2bn. But for fast-scaling tech companies, the bigger impact could be cultural, sending a signal that success may be punished rather than supported. Founders and investors thrive on mobility and flexibility. Startups depend on international hiring and flexible capital. Uncertainty risks fewer scale-ups and fewer high-paid tech jobs. 💡 Global context Ireland offers a stable corporate regime that’s helped attract European HQs for US tech giants. Singapore and the UAE actively court founders with low taxes and streamlined regulations, most recently Revolut's, Nikolay Storonsky. By comparison, the UK’s appeal has always rested not just on tax, but on ecosystem strength, world-class universities, deep capital markets, and access to skilled talent. 🇬🇧 Why the UK remains a great place to build and scale Despite the noise, the fundamentals are still strong: The UK remains Europe’s top destination for VC funding, with over £20bn invested last year. A deep talent pool, from fintech to AI continues to attract global founders. Government initiatives like R&D tax credits and the British Business Bank still make early-stage funding more accessible than in many other markets. The time zone, language, and legal system give the UK a unique advantage as a bridge between US and European markets. So while the debate around an exit tax is worth having, especially to keep the UK globally competitive, it’s equally important to recognise what’s working. 👉 Founders, investors, and policymakers should use this moment not just to criticise, but to collaborate, ensuring the UK stays the best place in Europe to start, scale, and stay. And the government should take a holistic and pragmatic view of the gains vs losses in any tax shakeup.

The UK is poised to transform its stock option landscape. If Chancellor Rt Hon Rachel Reeves implements the proposed EMI reforms this November, the UK will have the most competitive equity scheme among major economies in Europe, and globally. 🇬🇧 #notoptional Founder of Motorway Tom Leathes explains 👇

I recently worked with two UK tech founders who wanted to tidy up their shareholdings — and also bring a few key employees in as shareholders. One founder had been there from day one, taking all the early risks. The other joined later and helped scale the business. They wanted the ownership to reflect that — and also to reward the early team members who’d been part of the journey. The tricky part? Transferring or issuing shares between founders (or to employees) can trigger Capital Gains Tax (CGT) or even Income Tax/NI if it’s not structured correctly — even when no cash changes hands. We restructured things carefully so that: ✅ The founders’ share transfer qualified for Share-for-Share Rollover Relief, avoiding an immediate CGT charge. ✅ The employees received options under an EMI scheme, giving them genuine ownership potential with significant tax advantages. The result — ownership realigned, team rewarded, and no nasty surprises from HMRC. What I love about working with founders is helping them grow and share success in a way that’s both commercially smart and tax-efficient. If you’re a founder thinking about adjusting ownership or giving shares to your team, get advice before you do it — the right structure can save you a lot of unnecessary tax (and stress). — #UKTax #TechFounders #Startups #CapitalGainsTax #EMI #TaxPlanning #EmployeeOwnership #BusinessGrowth

Founder relocation: a growing trend with big implications 🌍✈️ More and more founders are questioning whether the UK remains the right base for scaling and exiting their business. This isn’t just about lifestyle. It’s about tax, exit strategy, and the long-term viability of scaling the UK base. Here’s what’s driving the shift: 1) Capital Gains Tax & Wealth Tax Concerns 📈 With speculation around CGT increases and broader wealth tax reforms, founders are reassessing their personal exposure – especially those with significant equity stakes approaching exit. 2) End of Non-Dom Regime 🚫 From April 2025, the UK’s remittance basis is gone. Founders will be taxed on worldwide income after four years of residency, regardless of where it is earned or held – making offshore planning significantly more complex and less effective. 3) Glass Ceiling for UK Scaleups 🏛️ Many founders feel they can achieve higher valuations and better exit outcomes by selling to US acquirers or relocating to jurisdictions with deeper capital markets. IPO pathways in the UK remain limited, and the US continues to offer strong liquidity and scale. 4) Tax implications for the Business ⚠️ When a founder relocates, it can trigger complex tax consequences – from permanent establishment risks to transfer pricing exposure and cross-border structuring challenges. Without proper planning, these can create friction during fundraising or exit. 5) Investor Dynamics 🤝 Relocation can raise questions around control, governance and tax residency – all of which impact investor confidence and deal readiness. If you’re a founder, CFO or finance lead navigating international growth, these issues are becoming increasingly relevant – and urgent. That’s why Steve Leith and I are teaming up for a webinar on Transfer Pricing & Scaling for Exit. We’ll cover: - Where to start with transfer pricing – and why it matters early - Structuring options for global growth - How to pass diligence without blowing up your deal - What founder relocation means for your company 📅 Tuesday 4th November, 13:00–14:00 🔗 Secure your spot here https://lnkd.in/e-wzZcNS #TechStartups #VCbacked #TransferPricing #ExitStrategy #CooperParry #ScalingUp Cooper Parry