Budget: Clampdown on VCTs and EISs targeting tax relief

clock

Chancellor George Osborne has announced a clampdown on venture capital trusts (VCTs) and enterprise investment schemes (EIS') purely set up to access tax reliefs.

In today's Budget, Osborne said the government will roll out a new disqualifying purpose test to exclude companies set up for the purpose of accessing relief. Osborne said the purpose of VCTs and EIS is to target genuine risk capital investments, as opposed to taking advantage of the generous tax breaks on offer. The consultation will come as a blow to some feed-in-tariff VCT and EIS providers. He said: "For both EIS and VCTs the government will also introduce a new disqualifying purpose test to exclude companies set up for the purpose of accessing relief, exclude acquisition of sh...

To continue reading this article...

Join Professional Adviser for free

  • Unlimited access to real-time news, industry insights and market intelligence
  • Stay ahead of the curve with spotlights on emerging trends and technologies
  • Receive breaking news stories straight to your inbox in the daily newsletters
  • Make smart business decisions with the latest developments in regulation, investing retirement and protection
  • Members-only access to the editor’s weekly Friday commentary
  • Be the first to hear about our events and awards programmes

Join

 

Already a Professional Adviser member?

Login

More on VCTs / EIS

The adviser evolution: Why tax‑efficient investing is becoming essential, not optional

The adviser evolution: Why tax‑efficient investing is becoming essential, not optional

Outcome‑driven advice will define future sector leaders

Andrew Aldridge
clock 17 April 2026 • 6 min read
VCTs raised £918m ahead of upfront income tax relief cut

VCTs raised £918m ahead of upfront income tax relief cut

Third highest annual fundraise on record

Michael Nelson
clock 08 April 2026 • 2 min read
Discipline, not relief will define the next era of VCTs

Discipline, not relief will define the next era of VCTs

'Periods of recalibration are not inherently negative'

Nick Morgan
clock 19 March 2026 • 4 min read