Reduce your tax bill by 30% with Venture capital

If you are unable to reduce your tax liability in 2016/17 because of the new ceiling on pension contributions for higher rate taxpayers, there is an alternative. Investment into certain, less capitalised, and therefore riskier companies, attract Tax relief.

Even if the tax year has passed, you can still invest now and treat the investment as occurring in 2015/16.

If you are unsure which companies to invest in, a venture capital trust is a fund holding a basket of selected, qualifying companies.

Other tax benefits include:

• Tax free growth (Capital gains tax exemption for an EIS and dividend exemption for a VCT.)
• Investors can also defer capital gains presenting the opportunity to reinvest cash from say a buy to let disposal, or from exiting options in the employer's company.
• Business property relief could keep investments outside of the estate. Transfers to spouses are already free of inheritance tax. Transferring those investments to a spouse would confer no further tax benefit, The assignment of fledgling companies to other family members could, therefore, be brought into will arrangements.

Aside from tax relief EIS and VCT provides investors with an opportunity to become a business angel, and diversity equity portfolio away form the typically pension fund composition.

Coman & Co. do not offer investment advice and are not connected to any venture capital promoters. This article is solely to highlight an investment strategy with significant tax advantages. Should you require assistance with your tax compliance requirements we are in a position to assist.