NEW tax rules have prompted a huge increase in the number of small and medium-sized firms changing hands across the South.

Business owners and entrepreneurs looking to sell up are taking advantage of the benefit of the new 10 per cent business taper relief introduced on April 6.

Low returns on savings and investments are also prompting many to buy into businesses as an alternative to the flat FTSE, report accountants Saffery Champness.

Transactions are taking the form of management buy-outs, mergers, acquisitions and partial sales.

Saffery Champness Bournemouth senior partner David Macey said: "We currently have several local deals in progress, and there are definite signs of more in the pipeline. In most circumstances, as long as a business is more than two years old people can dispose of it and pay just 10 per cent in tax - rather than the previous rules which in some cases saw 40 per cent of the benefit going to the tax man."

Mr Macey added: "Business owners are moving quickly in case the tax rules are not so favourable again in the future.

"The nature of many entrepreneurs in the region is that they like to start up and establish businesses then use the proceeds for the next project, while selling the business to a good management team to continue its progress."

Earlier this month, Saffery Champness was shortlisted in the growth company investor awards for Alternative investment Market accountants of the year.

This was the second year running the firm had been shortlisted.