HM Revenue & Customs (HMRC) has said it would meet back claims over a
three-year period, which could amount to an estimated £30m, and also excempt the
funds from VAT from October 8, according to investment trust trade body, the
Association of Investment
Ian Sayers, deputy director general at the AIC, told the Financial
Times, the move to exempt VCTs from VAT acknowledged their role in the
financial system. ‘Venture capital trusts make an important contribution to the
economy by investing in smaller, potentially high-growth businesses that promote
innovation, industrial change and modernisation of working practices,’ he said.
HMRC’s announcement came after Treasury plans which will enable investment
trusts to invest in bonds and other interest-bearing assets tax-efficiently.
The ruling was welcomed by AIC as a measure which could help trusts better
balance their portfolios and help manage risk.
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Laurence Field, the head of tax at national audit, tax and advisory firm Crowe Clark Whitehill outlines the 6 'unexpected items' regarding HMRC's Making Tax Digital plans