NCUB shares its views on tax support for entrepreneurs

Last week, NCUB submitted a response to HM Treasury’s call for evidence on tax support for entrepreneurship.

Our response focussed on the positive impacts that initiatives such as the Enterprise Investment Scheme (EIS) and Venture Capital Trust (VCT) scheme have had in providing a pool of capital for entrepreneurial firms to access and support their growth journeys.

We highlighted how the UK can strengthen tax support for entrepreneurship and improve the investment pipeline for high‑growth companies. However, while the UK is a strong hub for technology start‑ups, limitations in access to capital — particularly at pre‑commercialisation and scaling stages — hinder domestic growth. The Tony Hickson review into university-investor relations identified “valleys of death” in early‑stage finance and a shortage of specialist investors in areas like life sciences and deep tech. NCUB’s response suggests enhancements to the EIS and VCT schemes, including raised investment limits and long‑term policy stability, to help firms secure capital for longer and avoid cliff‑edges that disproportionately affect regions outside London.

The response also calls for addressing regional imbalances through greater engagement with investors and by supporting university‑affiliated venture funds, which can anchor investment into local ecosystems. When considering the Enterprise Management Incentive (EMI), we suggested it was a useful initiative for talent retention, but notes barriers for academic founders. Our work into researcher mobility showed the sizeable benefits from a more porous flow of people between industry and academia, and in our response we recommended the Government explores a tailored EMI route to improve mobility into spinouts.

Building on our Business-led R&D Taskforce report from last year, NCUB further recommends simplifying R&D tax credit processes to reduce burdens on SMEs, unifying the R&D funding landscape, and encouraging entrepreneurial reinvestment through measures such as capital gains rollovers and enhanced incentives for philanthropic funding of pre‑seed activity. These steps would collectively strengthen the UK’s innovation and investment environment.