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HMRC internal manual

Venture Capital Schemes Manual

From
HM Revenue & Customs
Updated
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Knowledge intensive companies: overview

ITA07/S252A (for EIS)

ITA07/S331A and section 297B (for VCTs)

There are higher limits for companies that meet the conditions for a knowledge-intensive company than other companies:

  • The number of full time equivalent employees must be less than 500 (instead of 250)
  • The total investment limit is £20 million (instead of £12 million)
  • The basic age limit (condition A) by which the initial relevant investment must be made is 10 years after the company’s first commercial sale (instead of 7 years).

To be a knowledge-intensive company, at the time of the investment the company must meet

  • at least one of the two operating costs conditions and
  • at least one of the innovation condition and the skilled employees condition

Where a company is a knowledge-intensive company because it depends upon meeting the skilled employees condition, it must continue to meet that condition for at least 3 years following the date the investment was made.