The United Kingdom will increase the capital gains tax on performance fees earned by private equity fund managers upon the sale of assets, known as "carried interest," raising it to 32%, announced Finance Minister Rachel Reeves during her budget statement on Wednesday.
UK hikes private equity 'carried interest' taxes
Reeves stated that her government will raise the tax rates on capital gains for carried interest starting in April 2025, up from the current rate of 28%.
A reform will come
Reeves also indicated that the government will reform the carried interest rules to make them "simpler, fairer, and more targeted" beginning in April 2026.
