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Home / Simons-Taxes /Personal and employment tax /Part E3 Reliefs for investors /Division E3.2 Venture Capital Trust schemes (VCTs) /Qualifying holdings of a VCT / E3.262 VCT—the risk to capital requirement
Commentary

E3.262 VCT—the risk to capital requirement

Personal and employment tax

The risk to capital requirement applies for shares or securities issued on or after 15 March 20181. It was introduced in order to reduce the incidence of investment in companies mostly focused on the preservation of the capital invested rather than long term growth and development2. The risk to capital requirement sets out two principles which aim to determine if, at the time of investment, the investee company is a genuine entrepreneurial company on which eligibility for relief is based.

These principles are that, taking into account all of the circumstances obtaining at the time the

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