Entrepreneurs and business owners are racing to sell their companies to beat the increase in capital-gains tax.

City advisers say that a number of deals are being accelerated so that shareholders avoid paying the extra duty when the increase from a base 10% to a flat 18% rate comes into effect on April 6.

British engineering group Hamworthy Heating, a maker of boilers for commercial property, is the latest company to beat the deadline. It has been sold by NBGI Private Equity for £35m to Atlantic, a French conglomerate.

Doing the deal now has saved NBGI Private Equity about £2m in duty and allowed it to recoup about six times its original outlay.

Some high profile business-men have also been trying to beat the rise. On Friday, Sir Ken Morrison, the grocer, rearranged his £1 billion stake in the company into family trusts.

Qinetiq chairman Sir John Chisholm transfered £17.7m of shares into a family trust.

Andrew Roberts, a partner at Travers Smith, the law firm, said: “People have definitely been trying to sell [businesses] and it is directly linked to the tax change.”

Jon Breach, at BDO Stoy Hayward, the accountant, said: “Entrepreneurs and private-equity backed companies that have been considering exits have been accelerating transactions because of the tax incentive.”

However, some might wait in the hope market conditions improve. “If they can hold on and sell for 10% more in a few months they can in effect neu-tralise the tax change,” Breach said.

Explore Entrepreneur

• SME

• Start-ups