Enterprise investment scheme ― introduction

Produced by a Tolley Corporation Tax expert

Corporation Tax

Guidance

The enterprise investment scheme (EIS) offers substantial tax incentives to investors in companies which qualify.

In summary, tax reliefs under EIS are as follows:

•
income tax relief for the investor of up to 30% of the amount invested
•
disposals of EIS shares after three years may be free from capital gains tax
•
capital gains tax deferral relief allows investors disposing of any asset to defer gains against subscriptions in EIS shares
•
losses on EIS shares may be offset against taxable income
•
EIS investments should qualify for IHT business property relief after two years’ ownership

Commercial and tax risk to consider when advising on EIS

The tax incentives for EIS investments are intended to encourage investment in high-risk companies. Therefore, there are stringent conditions associated with EIS reliefs and tax advice on EIS should be undertaken and supervised by a suitable experienced practitioner.

Terms of engagement for EIS work should be carefully drafted, in particular because conditions are tested on an on-going basis and tax advisers should ensure that

Continue reading the full document

To gain access to additional expert tax guidance, workflow tools, and tax research, register for a free trial of Tolley+™

TAKE A FREE TRIAL NOW

Popular Articles

Corporation Tax

Temporary differences

Temporary differencesCalculation of temporary differencesThe temporary difference arising in respect of an asset or liability is calculated by comparing the carrying value of that asset or liability with its tax base.IAS 12 uses the concept of taxable or deductible temporary differences. Whether a

14 Jul 2020 13:49 | Produced by Tolley in association with Malcolm Greenbaum Read more

Employment Tax

Income tax paid on behalf of employee

Income tax paid on behalf of employeeIntroductionEmployers may wish to make payments of employment income to an employee / director without the employee suffering a tax or NIC cost on that pay. In other words, the employer wants to pay an amount net of tax and NIC. In some instances, often with

14 Jul 2020 11:58 | Produced by Tolley in association with Paul Tew Read more

Owner-Managed Businesses

Furnished holiday lets

Furnished holiday letsThis guidance note sets out the qualifying conditions for a property let to be treated as a furnished holiday let (FHL) for tax purposes and the subsequent tax implications.Whether or not a property qualifies as an FHL can make an important difference to the taxation

14 Jul 2020 11:46 | Produced by Tolley Read more

��˾��ҹ��