Income Tax Act 2007 section 270

Assessment on withdrawal or reduction of relief

Section 270 sets out the rules governing how and when HMRC may make an assessment to withdraw or reduce VCT relief, including the time limit for such assessments and protection against posthumous clawback.

• Any assessment to withdraw or reduce VCT relief must be made for the tax year in which the relief was originally obtained
• HMRC has a maximum of six years from the end of the relevant tax year to make such an assessment
• The withdrawal or reduction provisions apply where relief is lost under sections 266 to 269 (e.g. disposal within five years, loss of VCT approval, or relief found not to have been due)
• No assessment to withdraw or reduce VCT relief may be made as a result of any event occurring after the death of the individual to whom the shares were issued