Investors’ Relief – a new tax break for Business Angels

 CGT, Investment Tax  Comments Off on Investors’ Relief – a new tax break for Business Angels
Nov 062016
 

Investors’ relief is a new CGT relief introduced by Finance Act 2016, designed for people who invest in unquoted trading companies without being involved in the management or operation of the business. These people cannot qualify for entrepreneurs’ relief on realising their investment, and so they wouldn’t expect to benefit from the special 10% rate – until now.

This is a tax relief which should be of particular interest to business angels. Although we already have other tax advantaged schemes, such as the venture capital schemes, they are too complicated and hedged with all sorts of rules and regulations. Investors’ relief is far simpler and should prove an attractive alternative for investors.

(This article can be downloaded in pdf format at Academia.edu)

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Apr 122016
 

Those of you who aren’t interested in Euro-law or compliance matters will probably be tempted to skip this article. While these are extremely important topics, I must confess, I too find substantive tax law more interesting. But instead of turning the page, I strongly suggest that you carry on reading. For these new rules aren’t confined to a single particular tax pigeonhole, but will affect a range of tax incentives such as the EIS and VCT Schemes.

In certain cases, failure to comply with the new rules may lead to a denial of the relevant tax break.

(This article can be downloaded in pdf format at Academia.edu)

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Update – Will Investment Funds be taxed at the same 18% rate as Corporates?

 Authorised Investment Funds, Corporate Tax, Investment Tax  Comments Off on Update – Will Investment Funds be taxed at the same 18% rate as Corporates?
Aug 052015
 

I can’t believe it. I’ve received a response to my email to HMRC enquiring what will happen to the tax rate for retail investment funds when the corporate rates are coming down to 18%.

Someone thinks I’m important at last! (Now if only The Times Money section will admit their VCT error).

The answer is a nice straightforward – “They may be. Then again, they may not.” Continue reading »

Corporate Tax rates are coming down to 18% – will the investment funds in your pension still be taxed at 20%?

 Authorised Investment Funds, Corporate Tax, Investment Tax  Comments Off on Corporate Tax rates are coming down to 18% – will the investment funds in your pension still be taxed at 20%?
Jul 312015
 

For years, retail investment funds have been subject to corporation tax at a special rate of 20% – special, because for a long time, the main corporate rate was 30% or more. But recently, corporate rates have been gradually coming down, till at last, this summer we are told that the main rate will eventually go down to 18% by 2020.

But what about authorised investment funds? Are they to be included in the new bonanza for corporates? Or will they continue to be taxed at the same 20% rate?

(This article can be downloaded in pdf format at Academia.edu)

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Summer Budget 2015 – Tax relief restricted for residential landlords (and other news)

 Investment Tax, Property Tax  Comments Off on Summer Budget 2015 – Tax relief restricted for residential landlords (and other news)
Jul 092015
 

The second Budget of 2015 has not been particularly kind to those people who buy homes to rent them out to those who need a place to stay.

Starting from 2017, individual landlords of residential property will only be able to claim tax relief on their finance costs at the basic rate. We shall look at these rules in further detail, as well as some of the other measures that will affect property landlords following the latest Budget. Continue reading »

Jul 022015
 

In this article we take a look at the Venture Capital Schemes and ask whether the risks involved are really worth it. In particular we see there are two types of risk – investment risk and tax risk. Investment risk can lose you money, but losing the tax reliefs is not necessarily fatal.

This article was first published on linkedin. Continue reading »

REITs – What do they invest in? Part Two – Investing in other REITs

 Investment Tax, Property Tax, REITs  Comments Off on REITs – What do they invest in? Part Two – Investing in other REITs
Jun 272015
 

In my interview with Taxlinked, I mentioned the fact that REITs could invest in other REITs as well as in the traditional bricks and mortar that one associates with property funds. In this article we shall have a closer look at what this statement actually means.

In particular we shall find out that while it is possible to have a REIT holding shares in other REITs, this cannot be the sole investment – there needs to be a minimum level of bricks and mortar for this to be possible. Furthermore, while distributions from other REITs are tax free, the exemption does not extend to capital gains. Continue reading »

Jun 022015
 

I’ve finally managed to update that table! It wasn’t easy getting it all on one page. Last time there were only three Venture Capital Schemes, now there are four, with the addition of the Social Enterprise Scheme. Soon we shall have a fifth in the form of the Social VCT. Continue reading »

Budget 2015 – Changes to the Venture Capital Schemes and EU State Aid

 Investment Tax, Venture Capital Schemes  Comments Off on Budget 2015 – Changes to the Venture Capital Schemes and EU State Aid
Apr 222015
 

UPDATE

This article was written shortly before the Summer Budget of 2015. Since then, some of the measures have been modified and are now enacted in F(No 2)A 2015, together with the introduction of a new blanket prohibition on using the funds raised to acquire shares in another company. For VCTs this puts a damper on the practice of raising money to finance management buy-outs.

One of the announcements made during Budget 2015 was a series of measures aimed at tweaking the Venture Capital Schemes so that they are in line with EU State Aid rules.

There are four Venture Capital Schemes, though the rule changes affect just two of them, the Enterprise Investment Scheme (“EIS”), and the Venture Capital Trust Scheme (“VCT”). The other two schemes are the Seed Enterprise Investment Scheme (“SEIS”) and the Social investment Tax Relief Scheme (“SITR”) introduced last year. Continue reading »

TaxLinked Interview – All about Real Estate Investment Trusts!

 Investment Tax, REITs  Comments Off on TaxLinked Interview – All about Real Estate Investment Trusts!
Mar 312015
 

Taxlinked is an online community designed and created exclusively for international tax, corporate and legal professionals. It can be thought of as a version of linkedin but for tax people instead. There are forums to share news and views, as well as a number of valuable knowhow resources. As well as topical articles, there are even e-books which are the result of collaboration between the members.

I joined recently, and was immediately invited to give an interview. Well, I must say I was flattered – I never thought that someone would want to interview me outside the job hunting process! Given my recent article Coming Onshore for Which Investment Trust, I thought that REITs might be a good subject, especially for our foreign tax friends.

Here is the interview, reprinted here with the kind permission of Taxlinked. Continue reading »