Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Business

Investors pull £300m from UK stocks amid inheritance tax fears

by October 30, 2024
October 30, 2024
Investors pull £300m from UK stocks amid inheritance tax fears

Rachel Reeves’s anticipated inheritance tax (IHT) changes have sparked a sharp sell-off in UK stocks, with investors withdrawing nearly £300m from funds invested in small UK companies last month, according to Morningstar Direct.

This represents a significant increase from the £80m withdrawn in August and reflects growing apprehension among investors about potential tax changes in Wednesday’s Budget.

Funds specialising in mid-sized UK stocks also experienced net outflows, with £30m withdrawn in September, ending five months of consistent inflows. This shift underscores the uncertainty in the market, as investors seek to avoid any adverse effects on their assets from possible changes to IHT exemptions.

Shares in smaller companies listed on Aim, the junior stock market, have long been a popular choice for wealthier investors aiming to minimise inheritance tax, as these shares currently qualify for business relief, making them exempt from IHT. However, fears of changes to this tax break are causing investors to divest before Reeves’s maiden Budget announcement.

Neil Birrell, chief investment officer at Premier Miton, highlighted the increased activity among smaller private investors concerned about IHT. “There’s very little liquidity around, and that’s pushing share prices down. Beyond that, there’s a general hesitation to invest in the UK ahead of the Budget,” he noted. The uncertainty, he added, has cast a shadow over UK equity markets, dampening sentiment.

Market analyst Mark Preskett from Morningstar also observed that financial advisers are seeing heightened nervousness among clients over the potential tax changes. “Some clients are anxious about potential tax adjustments, leading to more redemptions in recent months,” he explained. Smaller and mid-cap stocks, which are more exposed to the UK economy, are especially vulnerable to any Budget outcomes impacting domestic markets.

The impact of these investor moves is being felt by fund managers, with Liontrust reporting over £1bn in net outflows over the last quarter and wealth manager Brooks Macdonald attributing £100m in outflows to a drop in investor confidence.

As the Budget draws near, UK equity markets are under pressure, with investors looking to mitigate risks amidst speculation on tax reforms. This trend reflects broader concerns about the economic outlook and the potential for policy shifts that could reshape the investment landscape for small and mid-cap stocks in the UK.

Read more:
Investors pull £300m from UK stocks amid inheritance tax fears

0
FacebookTwitterGoogle +Pinterest
previous post
Reeves pushes Bank of England to prioritise climate change alongside economic growth
next post
Rachel Reeves first Labour Budget in 14 years in detail

You may also like

What Is Reverse Logistics and Why Should Business...

May 21, 2025

British Airways to cancel further flights up to...

August 23, 2022

Government gives 14 SMEs £2.5M to accelerate their...

May 11, 2023

How 4 Innovative Companies are Shaping the Future...

October 28, 2024

5 Payment Processing Strategies To Boost Your Revenue

May 24, 2023

Capita, Pizza Express and Lidl among 500+ firms...

May 30, 2025

Nvidia Overtakes Microsoft and Apple to Become World’s...

June 19, 2024

Britain’s services sector company profits fall for seventh...

August 29, 2023

Soft2Bet: Pioneering Innovation and Expansion in the iGaming...

May 17, 2025

Dragons’ Den – Are we in or out?

April 24, 2024

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Trump warns of ‘serious consequences’ if Elon Musk funds Democrats

      June 7, 2025
    • Musk jokes about reconsidering stance on Big Beautiful Bill after Schiff’s praise

      June 7, 2025
    • Musk deletes explosive posts about Trump and Epstein files

      June 7, 2025
    • House witness flips script on Dem who ambushed him during hearing with unearthed tweet: ‘Iceberg is ahead’

      June 7, 2025
    • Call with China’s Xi, and Trump-Musk exchange fueled barbs during 20th week in office

      June 7, 2025
    • Trump’s conservative allies warn Congress faces critical ‘test’ with $9.4B spending cut proposal

      June 7, 2025

    Categories

    • Business (8,152)
    • Investing (2,019)
    • Politics (15,568)
    • Stocks (3,136)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved