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HMRC internal manual

Venture Capital Schemes Manual

CVS: investors and reliefs: introduction

The CVS is intended to encourage mutually beneficial co-operation between unconnected companies. For this purpose it provides a range of tax reliefs for companies (‘qualifying investing companies’) which subscribe for shares in unquoted companies carrying on, or preparing to carry on, certain types of trading activities.

The reliefs available are:

  • investment relief, that is, a reduction in CT liability in respect of the amount subscribed, (see VCM91030 onwards),
  • loss relief (see VCM92000 onwards),
  • deferral of any gain accruing on an investment made under the CVS, where that gain is reinvested under the scheme (see VCM93000 onwards).

The loss relief and deferral reliefs are available only where investment relief is attributable to the shares disposed of.

The legislation is at FA00/SCH15.

The reliefs only apply to shares issued on or before 31 March 2010.