The 2015 Summer Finance Bill – Venture capital schemes

With effect from the date of Royal Assent, and subject to state aid approval, the Bill, inter alia:
  • requires that all investments are made with the intention to grow and develop a business;
  • introduces restrictions on the age of a company that is eligible for investment under EIS and by Venture Capital Trusts (VCTs);
  • requires, broadly, that investors are independent of the company at the time of their first Enterprise Investment Scheme (EIS) investment;
  • introduces a cap on the total investment a company may receive through the EIS and VCTs of £20 million for knowledge intensive companies and £12 million for other qualifying companies;
  • increases the employee limit for knowledge intensive companies to 500 employees;
  • introduces rules to prevent EIS and VCT funds being used to acquire existing businesses;
  • removes the requirement that 70% of Seed Enterprise Investment Scheme money must be spent before EIS or VCT funding can be raised for qualifying investments made on or after 6 April 2015.

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