Scores of UK company directors are preparing to sell their shares ahead of
April 6 to avoid an 80% hike in capital gains tax. Insurance company
Towergate is the
biggest company so far to reveal it is planning to sell a 25% holding to private
equity firm Candover, mainly to avoid the tax change from 10% to 18% on
business assets.
Andy Homer, Towergate chief executive, told The Daily Telegraph the
reason for the deal was to cash in before CGT changes came into force at
midnight on April 5. ‘It's an opportunity to avoid an 80% increase in tax,’ he
said.
The
Financial Services Authority has been inundated with requests for
clarification on how companies should disclose directors' dealings to such an
extent it has been forced to promise new guidance within two weeks to ensure
investors remain fully informed.
Tony Cohen,
Deloitte
head of private client services, said many of his firm's clients were
considering a sale, including directors of FTSE 100 companies. ‘It's prudent for
a director to consider how they might benefit from the 10% on shareholdings now
that it will change to the 18%,’ he said.
Further reading:
Insurers in last-ditch bid to get CGT scrapped
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