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The impact of capital taxation upon UK unquoted companies

The impact of capital taxation upon UK unquoted companies
The impact of capital taxation upon UK unquoted companies
The authors present findings from the initial phase of an ongoing externally funded research project into senior executive perceptions of the impact of capital taxation upon unquoted companies incorporated in the United Kingdom. Open-ended interviews were conducted with the senior executives of six unquoted companies which are also multigenerational family businesses. The interviews guided the executives to explore the history of their company; the values and aspirations of the founding or owning family(ies); the impact of capital taxation regimes, previous and current, both on ownership and on management succession; and strategies being pursued. Using content analysis to identify key themes, the authors suggest that their findings indicate that capital taxation may have a major impact both on ownership and on management succession as well as on succession planning. However, the current capital tax regime in the United Kingdom is perceived to be more favourable than that of previous regimes and vis-à-vis the regimes currently operating in most European countries. Capital taxation is not thought to influence strategic or operational decisions either positively or negatively. Companies use taxation-planning devices, frequently involving trusts, in order to reduce the actual burden of capital taxation falling upon individual shareholders at ownership succession. The present capital taxation regime, which includes gift relief and business asset taper relief within capital gains tax, and 100% business property relief within inheritance tax, eases succession planning. Business asset taper relief also facilitates shareholder exit strategies.
0263-774X
509-530
Casson, Peter
5ac137b1-dc94-41fb-82c5-736ad5be75c2
Jennings, Peter L.
6864fb94-df90-4f8b-9bfd-f3dc281a0b1e
Allen, Clive
3cb8f8e3-620d-4a7b-942e-5d3053b2d740
Casson, Peter
5ac137b1-dc94-41fb-82c5-736ad5be75c2
Jennings, Peter L.
6864fb94-df90-4f8b-9bfd-f3dc281a0b1e
Allen, Clive
3cb8f8e3-620d-4a7b-942e-5d3053b2d740

Casson, Peter, Jennings, Peter L. and Allen, Clive (2003) The impact of capital taxation upon UK unquoted companies. Journal of Environment and Planning C: Government and Policy, 21 (4), 509-530. (doi:10.1068/c032a).

Record type: Article

Abstract

The authors present findings from the initial phase of an ongoing externally funded research project into senior executive perceptions of the impact of capital taxation upon unquoted companies incorporated in the United Kingdom. Open-ended interviews were conducted with the senior executives of six unquoted companies which are also multigenerational family businesses. The interviews guided the executives to explore the history of their company; the values and aspirations of the founding or owning family(ies); the impact of capital taxation regimes, previous and current, both on ownership and on management succession; and strategies being pursued. Using content analysis to identify key themes, the authors suggest that their findings indicate that capital taxation may have a major impact both on ownership and on management succession as well as on succession planning. However, the current capital tax regime in the United Kingdom is perceived to be more favourable than that of previous regimes and vis-à-vis the regimes currently operating in most European countries. Capital taxation is not thought to influence strategic or operational decisions either positively or negatively. Companies use taxation-planning devices, frequently involving trusts, in order to reduce the actual burden of capital taxation falling upon individual shareholders at ownership succession. The present capital taxation regime, which includes gift relief and business asset taper relief within capital gains tax, and 100% business property relief within inheritance tax, eases succession planning. Business asset taper relief also facilitates shareholder exit strategies.

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More information

Published date: July 2003
Organisations: Management

Identifiers

Local EPrints ID: 35762
URI: http://eprints.soton.ac.uk/id/eprint/35762
ISSN: 0263-774X
PURE UUID: e5211ccd-df2d-4454-adad-8ec1c46c35c0

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Date deposited: 22 May 2006
Last modified: 08 Jan 2022 01:06

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Contributors

Author: Peter Casson
Author: Peter L. Jennings
Author: Clive Allen

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