Rule changes will allow more companies to access funding schemes
A wider range of companies will be able to access funding under changes being made to the UK Government’s enterprise schemes.
Chancellor George Osborne touched on the reforms in his Budget speech, with the Treasury unveiling the alterations in its 125-page Budget document.
The changes will affect the seed enterprise investment scheme (SEIS), the enterprise investment scheme (EIS) and venture capital trusts (VCTs).
Under the proposals, the employee limit for “knowledge-intensive companies” – such as software developers, technology firms and other high-tech outfits – will rise to 499 from 249, opening up the funding schemes to larger companies.
The Treasury added: “The government will also smooth the interactions between the schemes by removing the requirement that 70% of the funds raised under SEIS must have been spent before EIS or VCT funding can be raised.”
Whitehall will now need to apply to the European Commission for permission to make the changes under state aid rules.
Other measures outlined in the Budget document could also benefit small listed businesses that are trying to raise finance.
They included plans to let investors pump money from their individual savings accounts (Isas) into securities issued by small and medium-sized enterprises (SMEs) that are trading on recognised stock exchanges from this summer.
The Treasury also said: “The government will explore further extending the list to include debt (as announced at Autumn Statement 2014) and equity securities offered via crowdfunding platforms and will consult in summer 2015 alongside a response to the consultation on how to include peer-to-peer loans.”