Consultation outcome

Venture Capital Trusts share buy-backs

This consultation was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

This consultation has concluded

Download the full outcome

Detail of outcome

The government has now published a response to this consultation. The document confirms that the government will restrict tax relief available to investors using some share buy-back arrangements, sets out further information on the government’s concerns about the use of share premium accounts to return capital to investors, and confirms that the VCT scheme rules will be amended to allow investments via nominees to qualify.

Draft legislation on the changes to restrict particular share buy-backs and to facilitate investment into VCTs via nominee arrangements has also been published today. There is a period of consultation on this draft legislation that will close on 4 February 2014.

The government will run technical workshops to consult on the best way to address the use of share premium accounts to return capital to investors in January 2014, with draft legislation to be published following these workshops.

Original consultation

This consultation ran from to


A technical consultation on the types of share buy-backs used by Venture Capital Trusts


Consultation description

The government is today publishing a technical consultation on particular types of share buy-backs used by Venture Capital Trusts (VCTs).

As set out at Budget 2013, the government is concerned that the use of certain buy-back and reinvestment arrangements, sometimes referred to as ‘enhanced’ share buy-backs, are damaging to the industry and do not represent good value for money to the taxpayer.

This consultation document sets out the case for change and invites comments on options to address this issue. The government continues to be supportive of the industry as a whole and believes that VCTs can play an important role in supporting investment into small and growing companies.