UK Private Equity Partners Earn Record £5.4 Billion in Profits

UK-based private equity partners earned a record £5.4 billion in profits during the tax year ending April 2025, marking a 50% increase over the previous year. This surge generated £1.45 billion in tax revenue for HM Revenue & Customs. The spike is attributed to managers accelerating deals to avoid tax increases implemented by the Labour government.

Rachel Reeves, the Chancellor of the Exchequer, raised the levy on these payouts from 28% to 32% in April 2025, with a further increase to 34% scheduled for April 2026. Despite the record bonuses, total industry exits dropped to £42 billion, less than half of the £91 billion recorded in 2023. Over 65% of these deals were sales to other private equity funds.

Significant transactions during this period included Advent International's £2.7 billion sale of Evri Ltd. to Apollo Global Management Inc. and the sale of Kurt Geiger Ltd. to Steven Madden Ltd. for nearly £300 million. Michael Moore, CEO of UK Private Capital, defended the payouts, stating that managers only receive bonuses after investors are repaid and have beaten their hurdle rates.