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Low uptake for non-don SME tax break

Non-doms who would like to invest in UK SMEs have been offered a tax break by way of the Business Investment relief scheme – but so far only 17 applications have been made in the first year of operation.

The scheme would allow non-doms to avoid the 45 per cent tax that they would otherwise be subject to when bringing money into the country. Although there is no upper limit on the amount that can be invested under the scheme, so far only £13.3m of investments had been given advanced clearance by HMRC.

Peter Goodman, tax partner at Wilkins Kennedy, points to the excessive paperwork required as a factor in discouraging investors. He said: “This should be a hugely popular scheme drawing in much more money into the UK than it is. Unfortunately there is too much red tape surrounding this scheme [so] some advisers are reluctant to recommend it.”

The Business Investment Relief scheme was set up in part to utilise the vast resources held overseas by non-doms, to help fund UK SMEs. Many small businesses are currently struggling to access finance.

The scheme has drawn attention once again to the special position of wealthy non-doms whose UK tax bills are low as their wealth is held largely outside the UK.

There are a variety of tax breaks and investment schemes for your small business, many of which are unknown to the average business owner. Let us help you take full advantage of all that is available, contact us today to see how we can help your business grow. If you think you may be eligible for non-dom status with all the associated advantages, visit stmworldwide.com/non-domiciled-taxation for more details.

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