Private Equity Compensation: U.K. Exchequer Reveals Its Tax Proposals

On October 9, 2007, the London office authored an Alert Memorandum entitled “Private Equity Compensation: U.K. Exchequer Reveals Its Tax Proposals.” The new Chancellor of the Exchequer, Alistair Darling, announced in his 2007 Pre-Budget Report how the U.K. Government proposes to deal with the tax treatment of private equity compensation. In what otherwise might have been seen as a subtle pre-Election measure, he has not aimed any specific proposals at the private equity sector but has instead chosen to wrap up the changes in the general reform of capital gains tax and the sensitive issue of the tax treatment of U.K. resident but non-domiciled individuals.