2017/18 

Enterprise Investment Scheme (EIS) 

The Enterprise Investment Scheme (EIS) provides tax relief for individuals prepared to invest in new and growing companies. Investors can obtain generous income tax and capital gains tax (CGT) breaks for their investment and companies can use the relief to attract additional investment to develop their business. Individuals are entitled to relief on investments in certain unquoted trading companies through EIS.

Maximum investment per annum
 £1,000,000
Income tax relief
 30%
CGT treatment on disposal if held for 3 years
 Exempt

Capital gains from the disposal of other assets may be deferred by making an EIS investment.

Seed Enterprise Investment Scheme (SEIS)

The Enterprise Investment Scheme (EIS) provides tax relief for individuals prepared to invest in new and growing companies. Investors can obtain generous income tax and capital gains tax (CGT) breaks for their investment and companies can use the relief to attract additional investment to develop their business. A junior version of EIS known as the Seed Enterprise Investment Scheme (SEIS) has been introduced.

Maximum investment per annum
 £100,000   
Income tax relief
 50%
CGT treatment on disposal if held for 3 years
 Exempt

An individual who makes a capital gain on another asset and uses the amount of the gain in making a SEIS investment will not pay tax on 50% of the gain subject to certain conditions.

Social Investment Relief (SIR)

Social Investment Relief (SIR) is designed to encourage private individuals to invest in social enterprises including charities. Individuals are entitled to relief on their investment:  

Maximum investment per annum  £1,000,000
Income tax relief
 30%
CGT treatment on disposal if held for 3 years
 Exempt

Capital gains from the disposal of other assets may be deferred by making a SIR investment.

(All reliefs are subject to detailed conditions being met.)

Venture Capital Trusts (VCTs)

Venture Capital Trusts (VCTs) are designed to encourage private individuals to invest in smaller high-risk unquoted trading companies. VCTs operate by indirect investment through a mediated fund. In effect they are very like the investment trusts that are obtainable on the stock exchange, albeit in a high-risk environment. Individuals are entitled to relief on investments in VCTs.

Maximum investment per annum         
 £200,000
Income tax relief
 30%
Dividend income
 Exempt
Capital gains treatment on disposal
 Exempt

 

Disclaimer

This publication is published for the information of clients. It provides only an overview of the regulations in force at the date of publication and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this publication can be accepted by the authors or the firm.