The Enterprise Investment Scheme
The Enterprise Investment Scheme (EIS) was introduced by HMRC in 1994 to incentivise UK tax payers to invest in private companies by offering generous tax reliefs on qualifying investments.
The initiative has proved to be highly popular and successful, having enabled more than 27,000 companies to raise funds in the region of £18BN to date.
Income Tax Relief
Cashback of 30% against an individual’s income tax liability
Capital Gains Tax Relief
Gains on exit are free of capital gains tax providing the investment is held for a minimum of three years
If the shares are sold at a loss the loss, less any Income Tax Relief, can be set against income in the year in which they were sold or against income from the previous year
Capital Gains Tax Deferral Relief
Capital Gains Tax on gains realised on different assets can be deferred if the gain is reinvested in another EIS qualify company in the period of one year before or three years after the disposal of the asset
Inheritance Tax Relief
Holdings are 100% exempt from inheritance tax if held for at least two years