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Government’s Last-Minute Scrapping of ‘High Net Worth’ Rule Change Welcomed by Investment Industry

by Growthdeck Team

6 March 2024

News industry   EIS  

In today’s Spring Budget, the Chancellor announced he would scrap changes to the rules defining a high-net-worth investor, which would have sharply raised the barriers to investment in unlisted companies such as through EIS.

The rules would have increased the net assets an individual must own to be classed as a ‘high net worth investor’ from £250,000* to £430,000 and increased the annual income requirement from £100,000 to £170,000.

This would have locked many investors out of those private equity and venture capital-style investments which are only meant to be marketed to “high net worths”.

Simon Emary, Director and Head of Portfolio, says:

“It’s very welcome to see the Government listen to the investment industry and scrap what would have been damaging rule changes.”

“If these changes had been allowed to stand, they would have driven down the amount of investment going into start-up and scale-up investment in the UK. Scrapping the changes allows more people to be involved in supporting growth businesses.”

“The upcoming consultation on reforming the ‘high net worth’ rules needs to ensure that growth businesses don’t pay the price for tighter regulation.”

* Excluding main principal residence and pension

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