HedgeCo.Net (West Palm Beach) – Prominent hedge funds and private equity firms in London have a bad taste in their mouth after a whirlwind of tax scares imposed by British government.<\/p>\n
UK Chancellor Alistair Darling once again flip-flopped regarding increased taxation on non-domiciled residents. <\/p>\n
A non-domiciled resident is a foreigner living and working in the United Kingdom, who only pays taxes on their UK income – not any overseas income. The latest proposed legislation called for a flat rate tax of £30,000 (approximately $58,000), a year for all individuals who have lived in the UK for more than seven years.<\/p>\n
This news caused quite the stir amongst London based hedge funds. Out of the ten largest hedge funds in London, 35% of the directors on non-domiciled residents. <\/p>\n
Simon Walker, chief executive of the British Private Equity and Venture Capital Association pleaded, “Some of our members – particularly international ones – will be significantly affected and we think some people will leave the UK. We urge discussions at the Treasury to offset taxes against US taxes to be made a priority.” <\/p>\n
In addition to hedge funds, 75% of executives working in US Private Equity firms located in the UK would have been affected by the proposal. Senior officials urged the government to give this matter careful thought, since a resulting migration of talent to other countries could have a massive impact on London’s economy. <\/p>\n
The pressure finally made Darling retract on his statements, and the Treasury assured non-doms that the plans, which also included greater disclosure on offshore trusts, would be dropped. <\/p>\n
The problem now lies in the fact that companies have a mistrust of the UK government, and are especially weary as to what Darling’s next move will be. Last month, he was adamant on imposing a 18% flat rate tax of capital gains. After backtracking on his latest tax plans, some companies aren’t willing to wait around for his next move. <\/p>\n
“What has rattled the industry is not the £30,000 levy, it is the fear and uncertainty over what this Government will do next,” said Richard Jordan, a senior partner in a UK private equity firm. “In order to commit to running a business from London you need at least some certainty over three to five years of what the tax and regulatory environment might look like.” <\/p>\n
Julie Scuderi
Contributing Editor for HedgeCo.Net
Email: julie@hedgeco.net<\/p>\n
HedgeCo.Net is a premier hedge fund database and community for qualified and accredited investors only. Membership on www.hedgeco.net<\/a> is FREE and EASY. We also offer FREE LISTINGS for Hedge Funds! HedgeCo.Net (West Palm Beach) – Prominent hedge funds and private equity firms in London have a bad taste in their mouth after a whirlwind of tax scares imposed by British government. UK Chancellor Alistair Darling once again flip-flopped regarding increased […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-7148","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/7148","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/comments?post=7148"}],"version-history":[{"count":0,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/posts\/7148\/revisions"}],"wp:attachment":[{"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/media?parent=7148"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/categories?post=7148"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/hedgeco.net\/news\/wp-json\/wp\/v2\/tags?post=7148"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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