Press Room

23 Sep 2021

James Paull comments on Labour’s plan to crackdown on private equity tax ‘loophole’


James Paull, Head of Incentives Group, comments on the recent reports that the Labour party is planning a crackdown on the private equity tax loophole, in TheWealthNet.

James’ comments were published in TheWealthNet, 23 September 2021, and can be found here.

“Not for the first time, politicians have carried interests in their sights, with proposals to tax the returns on investment as salary.

“Whilst it is true that the individual investments are relatively small, the fact is that the returns from carried interest are very uncertain and a large proportion do not pay out at all.

“In these cases, the executives lose the money they have invested. These cases are ignored in statistics quoted.

“Although a relatively small number of arrangements can pay out very large amounts, it is wrong to suggest that carried interest is a certainty, or that the tax position is based on a “loophole”.

“Starmer clearly wants to use hindsight to tax something which at grant has little or no value – the fact that such arrangements may in the future payout does not make it right to change the tax system for some ill-perceived abuse loophole.

“This is nothing more than a thinly veiled attack on the “evil” private equity sector.”


James Paull

James is Head of the Incentives group at Andersen in the United Kingdom. He provides advice in respect of the deign, implementation and operation of employee incentive arrangements to companies, partnerships and individuals with a particular focus on tax, legal and technical aspects.

Email: James Paull