A number of tax relief schemes exist in order to encourage investments into enterprise.

These are designed to help smaller or newer businesses to raise the capital that will help them to grow and succeed, and they also represent exciting opportunities for investors.

SEIS EIS and Investment Reliefs

Among the most well-known are the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS).

The EIS offers 30% tax relief on shares of qualifying companies, with investors able to commit up to £1m per tax year. Many investors take advantage of its ‘carry back’ provision and apply their investment to the preceding tax year.

The SEIS applies to early-stage companies. An investor can back a new enterprise to the tune of £100,000 and receive 50% tax relief, as well as Capital Gains Tax exemption on the investment. Each new company is eligible for up to £150,000 funding through the scheme.

While the risk of investing into a start-up is greater than investing into an established and thriving business, many see an investment through SEIS to be relatively low risk thanks to the tax relief on offer.

With many nuances in both schemes, professional advice is worthwhile to ensure both the business and investor qualify for the schemes.

SPEAK TO AN EXPERT

Gill Molloy
Gill Molloy
Group Tax Partner
David Herd
David Herd
Group Partner
Martin Frain
Martin Frain
Tax Advisory Consultant

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