Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Private equity definition

What does Private equity mean? Private equity describes investment by professional funds in unlisted (unquoted) companies to obtain minority or controlling stakes, financing growth, management buy-outs/ins, recapitalisations or turnarounds, often alongside acquisition debt. The shares acquired are not admitted to trading on a stock exchange, so are less marketable and less liquid than public (quoted) equity. The term is not defined in legislation or case law; it is a market description used consistently across England & Wales, Scotland, Northern Ireland and Ireland. Transactions are privately negotiated and typically documented through investment and shareholders’ agreements, amended articles, preference shares or loan notes, management incentive arrangements (such as...

UK private equity funds: structuring and tax of limited partnership vehicles, fund managers, carried interest and investor terms

Published by a LexisNexis Tax expert

Practice notes

FORTHCOMING CHANGE relating to the tax treatment of carried interest:

Following a call for evidence on the taxation of carried interest conducted over summer 2024, the government used Autumn Budget 2024 to set out a redesigned regime from 6 April 2026. This will be embedded within the income tax system, with tailored rules acknowledging the distinctive nature of the reward. A consultation then examined possible new qualifying conditions for entry to the regime, with the government’s response issued in June 2025. Draft legislation for the new carried interest regime was published on 21 July 2025 for inclusion in Finance Bill 2026. The provisions will apply to carried interest arising on or after 6 April 2026. This was all confirmed at the 26 November 2025 Budget, which also noted amendments to the draft to reflect stakeholder feedback. In the interim, ahead of commencement, the capital gains tax rates applying to carried interest were raised to 32% with effect from 6 April 2025. For further information on this reform of carried interest taxation,...

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Emily Clark

Travers Smith

Emily trained at Travers Smith and is a partner in the tax group. She specialises in the taxation of investment funds acting for private equity houses, hedge funds and real estate funds.She advises on fund formation and on tax-efficient structures for fund managers, carried interest and LLP conversions. She has particular expertise in tax structuring for non-domiciled investors and fund managers.Emily also has extensive experience of group restructuring, international tax, joint ventures and real Emily is a member of the British Property Federation´s tax committee....

Web page updated on 21/05/2026

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