Truro tax expert: UK system is crushing Cornish entrepreneurs

Starting a business in Cornwall has never been easy. Now one of the country’s biggest accountancy firms says the tax system has made it barely worth doing at all.

Britain’s tax system is crushing entrepreneurs in Cornwall and needs to change if the government wants more people to start, scale and sell a business, a tax expert has warned.

Praveen Gupta, UK Head of Tax at top 10 accountancy and business advisory firm Azets, which has an office in Truro, said the current system needs changing to encourage local entrepreneurs to start businesses, hire staff and help the economy grow.

“No incentive to set up, scale and sell”

“There is no incentive to set up, scale and sell a business in the UK,” Praveen said.

“It costs more than ever to recruit staff and if you are able to sell your company, the Treasury takes a bigger slice of the proceeds than it has in decades.

“We understand the government needs to balance the books, but right now the tax system is preventing entrepreneurs from doing what they do best and the economy is suffering as a result.

“There’s a real risk the UK will lose the next generation of Bransons, Dysons and Bartletts unless something changes, either because they’ll go abroad or because they won’t take the leap and start their own businesses.”

The four changes he wants to see

Praveen has put forward a four-part plan:

1. Raise the Employment Allowance rate to £50,000.
2. Cut Capital Gains Tax (CGT) to 10% for people selling a business.
3. Restore the Business Asset Disposal Relief (BADR) lifetime limit to £5m.
4. Introduce a two-year Employment Tax Roadmap.

“This approach would make it easier for businesses to hire, reward founders who have successfully exited a company, especially an SME, and provide stability for the UK business community about the government’s plans for Employment Tax policy,” he said.

“Any impact this would have on Treasury income would be offset by the fact that there would be more money going into the economy as a result of these changes, and more jobs created across the UK.”

Hiring costs

Raising the Employment Allowance to £50,000 would give employers more confidence in managing costs and make them more willing to take on staff, Praveen said.

“A £50,000 employment allowance threshold would cut the National Insurance costs of the SMEs in the UK, as an employer wouldn’t have to pay anything unless their wage bill was more than £333,333. Currently NIC is due when a wage bill reaches circa £70,000.

“This small change would make a significant difference to SMEs, and to the UK’s employment figures, as firms would be more willing to hire people as they would know the NI costs could be managed and they’d have the funds to do it.”

Selling up

On CGT and BADR, Praveen argued that a lower rate and a restored £5m limit would let successful founders keep more of what they make, and put more of it back into other businesses.

“Entrepreneurs typically don’t retire. Many of them invest some of their hard-earned money from selling their businesses into start-ups or new companies looking to scale.

“Taking less of the money they make from selling a company would give them a larger amount to invest in new businesses, effectively creating an army of business angels who could help the entrepreneurs of the future grow.”

Knowing what’s coming

The two-year Employment Tax Roadmap is about giving owners time to prepare.

“The last two Budgets have had a significant impact on businesses, and both have given them little time to get ready for any changes the new tax year brings,” he said.

“An Employment Tax Roadmap would enable business leaders to plan more effectively and budget more accurately, which create more stability for businesses and the economy, in terms of growth, tax revenues and recruitment.”

The numbers behind the warning

Companies House figures analysed by Azets show nearly 13,700 fewer company incorporations in the 2025 calendar year compared with 2024.

Data from the Office for National Statistics shows an estimated 104,000 fewer payrolled employees between March 2025 and March 2026.

The same source puts vacancies down by an estimated 29,000 between January and March 2026 compared with October to December 2025, and 65,000 lower than the same period a year earlier.

ONS figures also show around 75,000 more people aged 16 to 34 left Britain than arrived in 2025, a gap that has widened every year since 2022.

“If the UK wants to avoid its entrepreneurs becoming an endangered species and really fuel economic growth, the government needs to take action now and evolve the tax system into something that encourages rather than stifles entrepreneurs and which gives them the stability they need to start and scale businesses,” Praveen said.

“If it can achieve that, the economy and the country will be much better off.”