Discovery Capital Corp., manager of British Columbia Discovery Fund (VCC) Inc. says the fund has received an increase in its 2003 tax credit allocation from the Investment Capital Branch of the B.C. Ministry of Competition, Science and Enterprise (ICB) to raise up to $20 million.
The fund has passed $10 million in sales and had sold out its original $10 million allocation for 2003. At the same time, the ICB has extended the expiry date of the 2003 allocation from Dec. 31, 2003 to March 3, 2004, the end of the 2004 RRSP selling season. All future tax credit allocations of the fund will begin on the first day following the closing date for eligible RRSP contributions under the Income Tax Act.
The fund’s tax credit allocation for each of 2004 and 2005 remains at $10 million, however, the fund is eligible to apply for an additional $10 million of allocation once the initial $10 million allocated for each year has been raised.
“BCDF has had strong sales as a result of several factors, including the significant improvements to the Small Business Venture Capital Act that were passed into legislation by the B.C. Government in the spring of 2003”, said John McEwen, CEO of the Fund and Discovery Capital Co-CEO. “These improvements have resulted in the development of a competitive VCC fund industry in the province. We are pleased that the Branch has approved the additional allocation based on the fund’s market-leading success to date.”
Eligible individual investors in the Fund receive a tax credit equal to 30% of the amount invested, to a maximum of a $60,000 tax credit per annum. Shares in the fund are eligible for RRSPs, RRIFs and RESPs.
BCDF is similar to the labour sponsored investment funds available to investors in B.C., with added advantages that include:
- a 30% investment tax credit on investments from a minimum of $2,500 to a maximum of $200,000 (vs. $5,000 maximum investment level for LSIFs); and
- the ability to request redemption after five years (vs. an eight year hold period for LSIFs).
www.bcdiscoveryfund.com.