UK Faces Entrepreneurial Exodus as Tax Reforms and Economic Worries Mount
In a striking trend that underscores growing challenges for the British economy, nearly 6,000 owners of high-growth businesses have left the United Kingdom over the past two years. This significant departure follows sweeping changes to the UK’s tax regime and escalating concerns over the nation’s economic competitiveness on the global stage.
Research Reveals Scale of Departures
According to detailed research conducted by wealth manager Rathbones, which analysed Companies House filings from January 2024 through 2026, the exodus has been particularly pronounced among entrepreneurs in the technology sector. The findings, initially reported by the Financial Times, highlight that the United Arab Emirates has emerged as the most attractive destination for these departing business owners, followed closely by Spain and the United States.
Tax Changes Drive Decision-Making
The wave of founders fleeing the UK comes in response to comprehensive tax reforms that have significantly impacted wealthy individuals and business proprietors. Key changes include a new inheritance tax regime tailored for business owners, increased rates of capital gains tax, and the abolition of the non-dom status. As of April 2025, this abolition replaced the previous system with a residence-based regime, rendering long-term UK residents liable for taxes on their worldwide income and gains.
Chancellor Rachel Reeves has implemented measures that restrict the amount of inheritance tax relief available to businesses when they are passed down. Concurrently, she has made it easier for British citizens to avoid inheritance tax by relocating outside the UK for at least a decade. Notable figures who have already left include Richard Gnodde, vice president of Goldman Sachs, and Nassef Sawiris, co-owner of Aston Villa.
Insights from Industry Experts
Michelle White, head of private offices at Rathbones, commented to the Financial Times, noting that international mobility among business owners and wealth creators is accelerating rapidly. She emphasized that these findings illustrate a clear shift in where UK entrepreneurs are choosing to establish their bases.
White pointed out that it is particularly younger business owners who are seeking relocation, driven by a pursuit of better opportunities, more favourable tax environments, and greater optimism regarding long-term growth prospects. She also issued a warning, stating that this trend underscores the critical importance of maintaining an internationally competitive economy, tax system, and talent pathways.
Net Outflows and Economic Implications
Over the last two years, while 3,182 business owners moved to the UK, the net exodus from the country amounted to 2,758 individuals, according to Rathbones’ data. Additionally, the UK experienced a net outflow of 16,500 millionaires last year alone, representing approximately $91.8 billion (£68.1 billion) in investable wealth. In stark contrast, jurisdictions such as the United States and the United Arab Emirates have seen corresponding inflows of wealth and entrepreneurial talent.
Industry figures attribute this shift away from the UK to a perceived lack of focus on entrepreneurs compared to other nations, where regulatory clarity and supportive environments foster substantial business growth. This ongoing trend raises pressing questions about the UK’s ability to retain its innovative and high-achieving business leaders in an increasingly competitive global landscape.
