Investors are pouring cash into tax-efficient schemes including VCTs and EIS ahead of new legislation that will ban investments into low-risk businesses from receiving generous tax breaks, which could be passed as early as 8 March.
The bill will introduce a "risk-to-capital condition", which will stop investors taking advantage of tax breaks by investing in low-risk venture capital trusts (VCTs) and enterprise investment schemes (EIS) - they will only receive tax breaks by investing in higher-risk vehicles. It comes after Chancellor Philip Hammond's 2017 Budget, in which he said he wanted to crack down on these schemes being used as capital preservation vehicles instead of ways to fund high-growth but high-risk businesses. Ian Battersby: Deal-flow and deployment - the EIS 'must haves' These types of funds ha...
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