HMRC error leaves VCTs unable to issue shares

New legislation introduced by the Treasury was intended to prevent VCTs from abusing their tax-efficient status by paying out dividends to investors buying in to a VCT for a very short period of time purely to collect the tax-free dividend. However, wording in this year's Finance Bill mistakenly implies trusts paying dividends to any shareholders purchasing new shares after 6 April would lose their tax-efficient status. Some VCTs are understood to have held off issuing new shares after 6 April as a result, with fears compounded by HMRC's decision last month to revoke the tax-efficient...