It is just six days until Chancellor George Osborne makes his 2016 Spring Budget announcement. As ever, changes to the UK’s taxation system are likely to feature prominently, with investors and high earners eagerly waiting to find out how their tax plan could be impacted in the year ahead.
Figures published by HMRC reveal wealthy Britons currently pay more than a quarter of the country’s entire income tax bill, with nearly 300,000 taxpayers having contributed to the equivalent of £45.9 billion between them. Furthermore, an estimated £4.7 billion was chalked up as ‘wasted’ tax in 2014 and a further 74% of taxpayers admitted they had not done anything to reduce their tax waste in the last 12 months. In light of this issue, IW Capital today launches the Taxpayer Sentiment Report 2016.
The nationally representative research examines how much income tax British investors are paying in comparison to the national average, with a focus on those with investment portfolios worth over £40,000. With only a select few government-backed initiatives remaining that promote tax efficient investments, the study also reveals investor sentiment towards one of the most prominent – the Enterprise Investment Scheme (EIS) – in the context of their 2016 tax planning agenda. These findings are supported by insights from Sarah Wadham, the Director General of the EIS Association.
IW Capital’s Taxpayer Sentiment Report 2016, based on an independent, nationally representative survey of over 2,000 UK adults, reveals:
- The average amount of income tax paid in the UK in the 2014/15 tax year
- How much more income tax is paid by Britain’s serious investors
- The sentiment UK investors hold towards EIS
- The monetary amount – over the next ten years – investors intend to work with
We discovered that serious investors in Britain are paying more than four times the national amount of income tax. Moreover, the majority of them are considering investment through the EIS for the next tax year. This highlights the importance of the scheme as one of the few remaining ways that investors can effectively manage their taxes while also supporting exciting, high-growth SMEs.