Strong deal activity ahead of tax deadline

Russell-Cooke’s Corporate and Commercial team has reported significant activity in corporate transactions across the South of England, totalling nearly £60m in value as the 2025/26 tax year deadline approached. The anticipation of impending tax changes prompted business owners to expedite their deals, particularly within the technology sector, where nearly half of the transactions arose. Corporate partner Peter Jeffery noted that uncertainty surrounding potential tax reforms and confirmed increases to Business Asset Disposal Relief (BADR) spurred this surge in deal activity leading up to 6 April 2026. He explained that “the first factor was a general sense of caution among business owners around the potential for further tax changes. While both the 2024 and 2025 Budgets had already introduced increases, there remains ongoing uncertainty around the direction of future fiscal policy, and many clients were keen to avoid the risk of additional changes impacting their transactions”.

Jeffery elaborated on the significance of the BADR rate hike, stating “the second, and more significant factor, was the increase in the rate of Business Asset Disposal Relief. From 6 April 2026, the BADR Capital Gains Tax rate increased to 18%, up from 14%. For many SME owners, that 4% difference represents a material saving, so there was a strong incentive to complete transactions before the deadline.” As a result, the firm observed a notable acceleration in deal timelines, with the corporate team, including partners Peter Jeffery and Thomas Clark, as well as associate Hayleigh Southgate and legal assistants Oliver Ward and Mark Norman, collaborating closely with clients to navigate the rapid changes and ensure timely transactions.

This spike in activity reflects a pattern seen during previous fiscal events where anticipated tax changes have led business owners to hasten their planned transactions. Peter Jeffery added, “while tax considerations should not be the sole driver of a transaction, they are an important factor in timing. In this case, many of our clients already had deals in progress and were motivated to complete before the increase in BADR rates took effect.” The firm supported clients through a diverse array of complex matters, from business sales and acquisitions to transitions to employee ownership, ensuring collaboration with management teams and stakeholders to keep processes on track. Jeffery noted the encouraging resilience and growth potential of UK SMEs, particularly within the technology sector, stating “it’s particularly encouraging to see the strength of the technology sector within this activity, highlighting the continued resilience and growth potential of UK SMEs in the South of England”