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AIC welcomes UK announcement that venture capital trusts can claim back VAT

The Association of Investment Companies has expressed its satisfaction at the announcement by the UK tax authority that it will meet back claims of value-added tax for venture capital trus

The Association of Investment Companies has expressed its satisfaction at the announcement by the UK tax authority that it will meet back claims of value-added tax for venture capital trusts, a move that the association estimates could allow trusts to recover as much as GBP30m in back VAT.

The UK government had previously announced that VCTs would benefit from an exemption from VAT from October 1 onward. However, the announcement by HM Revenue & Customs means that VCTs will also be able to claim back VAT paid at least in the past three years.

‘This is a very welcome development which demonstrates the government’s support for the important role that VCTs play in the financial system,’ says AIC deputy director-general Ian Sayers.

‘VCTs 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. They provide invaluable capital and expertise to young and start-up companies.’

The Association of Investment Companies was founded in 1932 to represent the interests of the investment trust industry, but today represents a broad range of closed-ended investment companies, including VCTs. The AIC has 357 members with total assets of some GBP94bn.

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