Two energy funds launched with tax benefits
UK alternative investment boutique launches renewable and clean energy investments vehicles with tax benefits.
Future Capital Partners is opening two new funds for UK retail, institutional and high net worth investors seeking to invest in renewable and clean energy, with the added benefit of tax efficient structures.
The funds, both from Future Capital Partners (FCP), include an enterprise investment scheme (EIS) and a venture capital trust (VCT).
The first fund, an EIS vehicle called the Elara Renewable Fund, launched on 7 January to investors offering a minimum of £5,000.
It aims for returns of 7% post-tax annually, and seeks low risk opportunities across the renewable sector following a conservative strategy, the firm said.
A number of tax exemptions are included in the investment: income tax relief of 20% on investments up to £500,000 in a single tax year, deferral of capital gains tax liabilities and 100% relief from inheritance tax after two years.
Capital gains realised on investments relinquished after three years should be exempt from capital gains tax, the firm said.
FCP’s Clean Future VCT is yet to open, with an official launch planned for the first two weeks of February.
It will seek to give investors tax free dividends of 7% on an annual basis. Shares will be offered at £1 per share, with a target total return of 130p per share.
Like the EIS, it will require a minimum investment of £5,000.
Investors will qualify for income tax relief of up to 30% and capital gains tax exemption upon exit from the investment, FCP said.
For both funds, the firm plans to invest in wind, biomass, landfill gas and solar technology companies with a long-term track record, strong business plans and growth potential, given support by government legislation and subsidies.
FCP holds a background in renewable energy investment. It currently runs an investment partnership aimed at high net worths to fund and build an industrial scale bioethanol plant in the North of England.