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Tax advantaged venture capital schemes too complex, says ICAEW

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ICAEW has raised a number of concerns in response to the recent HM Treasury/HMRC consultation, Tax advantaged venture capital schemes: draft legislation and explanatory notes, which closed 15 May. The consultation, sought views on the proposed package of changes to EIS and VCT announced at Budget 2015 and which the government intends bring forward in a future Finance Bill. These measures were not included within Finance (No. 2) Bill 2014/15 as some are subject to state aid approval.

The ICAEW noted that the government’s intention is that the ‘schemes remain: effective and targeted, affordable, simple and straightforward to administer, sustainable and not subject to abuse, and compliant with state aid rules’, but said that ‘in reality not all of these can be achieved at the same time’. The ICAEW added that some of the announced changes ‘only increase the complexity further’, although it also welcomed the new increased limits for knowledge intensive companies.