Introduced all the way back in 1993, the Enterprise Investment Scheme (EIS) offers qualifying small companies the opportunity to give investors the opportunity for generous tax reliefs. The rules for a company to qualify for the scheme are quite complicated, but if applicable, can make the business incredibly attractive.
If you are in a trade that qualifies (most do but there are some exclusions), been operating for more than four months, less than £15m in gross assets and fewer than 250 employees, you could become an eye-catching investment for venture capitalists.
The tax reliefs for investors are many; 30% upfront relief on Income Tax, Capital Gains Tax (CGT) deferral, no CGT to pay on realised gains, a loss set against any other gains, and the shares reside outside of the investors estate for Inheritance Tax.
If you’d like to find out more how you could take advantage of this tax relief scheme, get in touch. Contact your local AIMS Accountant for more information.