A business owner in the UK taking £160,000 a year in salary and dividends would face the fourth-highest overall tax bill among 13 developed economies once inheritance tax is included, according to a study published on Sunday by financial education specialists Investing Insiders.
The analysis puts the UK total at £324,982.81. Only Japan, at £370,215.53, France, at £367,817.47, and Ireland, at £348,409.11, generated higher bills. Seven of the 13 countries in the study produced a tax burden of less than £100,000.
Investing Insiders modelled the finances of the same hypothetical individual across each G7 nation and other popular destinations for Britons moving abroad. The calculations covered income tax, dividend tax, inheritance tax and investment taxes, with all figures converted into sterling for a like-for-like comparison.
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The business owner persona pays themself a £60,000 salary, receives a £100,000 dividend, makes £20,000 of pension contributions and puts £20,000 into an ISA. The individual also inherits a £1.2m estate from a parent, made up of a £950,000 home, £200,000 in ISAs and investments and £50,000 in other assets.
The business owner was one of four personas the firm assessed. According to the published findings, an average earner on £39,039 faced the UK’s third-lowest burden among the 13 countries, while a £99,000 earner ranked fifth highest and a high earner on £207,000 ranked third highest, at £1,250,381.75. The United States ranked lowest across all scenarios.
Investing Insiders said the study aimed to find which countries allow residents to keep more of their money. It cited a 17 per cent increase over the past year in searches about emigrating or moving abroad. Office for National Statistics figures show 246,000 British nationals left the UK in the year ending December 2025.
On income alone, the UK business owner in the study would take home £31,303.40 from their wage and £63,713.79 from their dividend, along with the full £815 earned from investments, which are tax free inside an ISA. That leaves £44,982.81 in income-related taxes, the sixth highest of the 13 countries.
Ireland topped that measure, with the equivalent of £66,356.11 in tax. France was second at £49,530.10, almost £17,000 less than Ireland.
The study found the UK compared more favourably on pension tax relief. On £20,000 of contributions, it said the government would add £5,486.50 in relief and a further £1,946 could be claimed back through a tax return, taking the total to £27,432.50.
On the £1.2m estate, the study calculated a UK charge of £280,000, the fourth highest in the comparison, which lifted the overall bill to £324,982.81.
Australia, Canada, New Zealand, Portugal and the United States charge nothing on the inheritance in the study’s model, meaning a UK heir would pay £280,000 more than one in those countries. Spain and Italy would each charge less than 5 per cent of the UK figure, according to the analysis.
The firm said inheritance tax accounted for almost 90 per cent of overall charges for its highest-earning UK persona.
The study follows other research and campaigning on the tax treatment of business owners. A Make UK and Bishop Fleming survey this month found that one in five family manufacturers are weighing an overseas sale because of inheritance tax changes.
In June, more than 90 founders and 19 MPs wrote to the Chancellor warning that cumulative tax rises were prompting entrepreneurs to relocate abroad. Concern over wealth leaving the country predates both, with research in 2024 pointing to the largest exodus of millionaires globally from Britain.
About the author
Jamie Young
Jamie Young is Senior Reporter at Business Matters, covering SME finance, employment law and Westminster policy since 2016. He has reported on every Budget and Autumn Statement since 2018, helped make sense of the ‘covid era’ and the bounce-back loan scheme from launch through the fraud investigations, and broke the magazine’s coverage of the 2024 late-payment reforms. He joined Business Matters straight from completing his BA in Administration from Exeter University and is NCTJ-qualified. Reach him at jyoung@cbmeg.co.uk
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