The £500million Future Fund designed to help UK start-ups has been extended to cover UK firms which shifted headquarter abroad to access funding.

The Treasury said applicants will need to prove at least half of their staff are based in the UK with a minimum of 50 per cent of revenues derive from sales in this country.

Chancellor Rishi Sunak said: "This change means that those start-ups who have strived to be the very best, and taken opportunities to grow their business, will be able to benefit from our world-leading Future Fund."

The fund offers convertible loans of between £125,000 and £5million to companies which have raised at least £250,000 of equity investments.

Loans - which will be matched by private investors - will convert to equity if the loans are not repaid.

The fund is designed to help start-ups in sectors such as tech and life science with more than 320 early-stage firms receiving £320million of loans so far.

Business Secretary Alok Sharma said: "As we restart our economy, it is crucial that our innovators and risk-takers get all the support they need to flourish.

"Our decision to relax this rule recognises the importance of many of the UK's most cutting-edge startups as we bounce back from coronavirus."