This years Budget promised us to leave us on the edge of our seats, concerning several topics. For Enterprise Investment Schemes (EIS), Venture Capital Trusts (VCT), ISAs and peer-to-peer (P2P) ISAs, there are many changes for UK savers and investors they need to be aware of.

EIS/VCT

Last year’s Budget was labelled the “Budget for Investors” when the extended the generous tax benefits in several areas, including EIS and Seed EIS (SEIS). This year it seems to be taking a step back in the incentives for small UK company investing. The chancellor announced qualifying companies for VCT and EIS “must be less than 12 years old when receiving their first EIS or VCT investment”. There has never been an age limit on these investments, but we can expect that this will cause an impact with some companies that will just miss the cut off.

EIS companies have the stereotype of being new, start-up companies. While this may not always be true, VCTs have a much greater reputation for investing in small companies at various stages.

Help to Buy ISAs

The government also introduced a Help to Buy ISA. First time home buyers will be able to gain an extra £50 for every £200 saved, with the maximum bonus of £3,000 on purchases up to £450,000 in London and £250,000 outside of London. The accounts should be available this autumn, and will not require a minimum monthly deposit.

This has already started to receive criticism. Average house prices in the UK are £200,000 and nearly £400,000 in London, and the rising property prices showing no signs of stopping, there may not be many properties that will be available for them buy. Matt Hutchinson of SpareRoom.co.uk told FT Adviser, “As for the bigger picture, this ISA will merely stoke demand without addressing the UK’s chronic supply problem. Unless house prices and rents become more affordable, we stand no chance of reaching the real housing goal, which is providing a range of affordable, secure tenures for all, so people can choose the one that best suits their needs.”

P2P ISAs

Last year’s Budget brought news of a P2P being able to be held within an ISA. The government launched a consultation in October 2014 on the best way to structure the ISA, and the response is set to come to us this summer. During this time, another consultation will be carried out to see if extending the product to allow “debt and equity securities offered via crowdfunding platforms”.

We have certainly been awaiting patiently for the arrival of P2P ISAs, it is encouraging to see the government increasing their support in alternative finance.

Although we are still waiting to hear about the logistics of a P2P ISA, there are one or two platforms, such as Wellesley & Co., that have already launched peer-to-peer ISA eligible investments.