Dec 192013
 

One of the welcome changes in the recent Autumn Statement is the classification of a REIT as an institutional investor for the purpose of the “close company” test. This will hopefully make it easier for REITs – both foreign and domestic – to invest in other REITs.

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Autumn Statement 2013 Venture Capital Trusts and Share Buybacks

 Tax Avoidance, Venture Capital Schemes  Comments Off on Autumn Statement 2013 Venture Capital Trusts and Share Buybacks
Dec 172013
 

New rules are being introduced to restrict upfront relief, where an investor sells his shares back to the VCT and uses the proceeds to subscribe for another shareholding. In this way, one can have a series of share subscriptions, each one giving rise to tax relief, but with no fresh money actually going into the system and finding its way towards the high growth companies that the VCT scheme is intended to benefit.

Rules to restrict upfront relief in a share buyback situation were first mooted in the Consultation Paper earlier this summer. We now have some draft legislation, so it is now possible to explore in more detail, just how these new rules will apply.

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