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Individuals aged 18 or more who subscribe on their own behalf for new eligible shares in a VCT can claim relief from income tax in respect of their investment for the year of assessment in which the shares are issued to them. The maximum subscription available for relief is £200,000¹. For 2003/04 and earlier years, the maximum was £100,000.

Eligible shares are ordinary shares which, throughout the period of five years from the time of issue (or three years for shares that were issued after 5 April 2000 and before 6 April 2006), carry no present or future preferential rights to dividends or to a company's assets on a winding-up and no present or future right to be redeemed². See E3.234 for more on preferential rights.

Relief for shares issued after 5 April 2006 is given at the rate of 30%³. For shares issued in 2004/05 and 2005/06 only, relief was given at the higher rate of tax⁴.

Relief can only be given to the extent that