New regulations have been introduced bringing important changes for investors in the Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) scheme.
These tax reliefs were set to expire on 6 April 2025. They have now been extended for an additional 10 years to 5 April 2035. This means that qualifying investments in EIS and VCT shares made before that date will benefit from tax reliefs (provided other conditions are met). The extension took effect on 3 September 2024.
As a result, investors who invested in qualifying companies through the EIS or VCT schemes will continue to enjoy tax benefits, such as income tax relief, until 2035, so making these schemes even more attractive for long-term investment planning. While, from a business's perspective, start-ups and growing companies that rely on investment through the EIS and VCT schemes will benefit from continued access to capital.
With the extension providing stability for investors and businesses and encouraging investment in high-growth, high-risk companies, the measure ensures that the EIS and VCT schemes are likely to remain key in the UK’s efforts to support small businesses and encourage entrepreneurial investment well into the 2030s.