Consultation outcome

Tax-advantaged venture capital schemes: draft legislation and explanatory notes

From:: HM Treasury, HM Revenue & Customs and The Rt Hon David Gauke
Published: 24 March 2015
Last updated: 8 July 2015 — See all updates

Read the full outcome

Tax-advantaged venture capital schemes: response to the consultation on ensuring continued support for small and growing businesses

Ref: PU1837

PDF, 376 KB, 25 pages

The Equity Gap and Knowledge-based Firms: Executive Summary

PDF, 508 KB, 6 pages

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Detail of outcome

In July 2014, the government launched a consultation on the tax-advantaged venture capital schemes. Following this, the government announced at the Summer Budget 2015 that it would introduce a series of changes to place a greater emphasis on supporting innovative firms, whilst continuing to provide targeted support for growing firms, in line with new State aid rules.

This document summarises the main issues raised by respondents under the consultation questions and outlines the government’s response to these. It reiterates the government’s commitment to ensuring that the schemes continue to provide appropriate support for small and growing businesses across the UK, and provides further details on the changes announced at the Summer Budget 2015. The government is grateful to those who participated in this consultation.

Original consultation

Consultation description

At Budget 2015 we announced a package of changes to the Enterprise Investment Scheme (EIS) and Venture Capital Trusts (VCT):

a new 12-year age limit on companies qualifying for EIS/VCT investment
a new cap on total EIS/VCT investment that an individual company can receive of £15 million for most companies, and £20 million for ‘knowledge-intensive’ companies
an increased employee limit of 499 for knowledge-intensive companies
removal of the barriers between Seed Enterprise Investment Scheme and EIS/VCT funding

Some of these changes are subject to State aid approval and therefore legislation has not been published in the Finance Bill 2015.

This document sets out the detailed legislation that will be brought forward in a future Finance Bill. A tax information and impact note on the changes is published alongside this consultation.

Documents