Taxation
Income tax relief of up to 30% is available to Qualifying Investors on the amount subscribed (subject to a maximum investment in VCTs of £200,000 in any one tax year and a Qualifying Investor’s income tax liability only being reduced to nil), provided the Shares are held for at least five years and the VCT status of the Companies is maintained;
Tax free dividends to Qualifying Investors (subject to the annual investment limits); and
Capital gains tax exemption on any gains arising on the disposal of the Shares.
Examples of the effect of the initial 30% income tax relief*
| Cost of investment |
Per Share |
| Gross subscription by Investor |
100p |
| 30% tax relief |
(30p) |
| Effective net issue price |
70p |
| Initial value of Investment |
|
| Gross subscription by Investor |
100p |
| Issue costs |
(5.5p) |
| Initial Net Asset Value |
94.5p |
| Initial uplift (pence) |
+24.5p |
| Initial uplift (%)** |
+35% |
* assuming an Offer Price per Offer Share of £1 and subject to an investor being a Qualifying Investor who holds the shares for at least five years in order to retain the income tax relief (subject to a maximum investment in VCTs of £200,000 in any one tax year and a Qualifying Investor’s income tax liability only being reduced to nil). As such, this initial uplift cannot be immediately realised.
** This example uplift does not take into account the price at which Shares will trade which is likely to be at a discount to NAV.
