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Doubt over social investment tax relief

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The government has published details on tax relief for social investment which was announced in the Budget. The consultation was launched at the G8 Social Impact Investment Forum in London, and closes for comment on 6 September 2013.

Commenting on the consultation document, Anthony Timmins, social business tax leader at PwC, said, ‘The proposed relief is aimed at investments in charities, community investment companies and community benefit companies with no more than 250 employees, but it’s not clear what the limit will be on their financial size, which could make a big difference. It’s also suggested that relief will at least initially be capped at €200,000 over three years (to fall within EU state aid provisions) which will most likely encourage smaller social enterprises working locally. The proposals are welcome, but it’s questionable whether the amounts at stake will make the kind of step change in the balance between the state and the third sector which is the policy objective – but this could change through the consultation process. Almost every aspect of the relief, except for the rate, and the fact that it will go to individuals not trusts or companies, is up for consultation.’

Issue: 1173
Categories: News , Corporate taxes