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J R Watson & Co Accountants

Northampton: 01604 630745 Rugby: 01788 575037 Email us

Tax reliefs for individuals

EIS, SEIS, VCTs and SIR.

  1. Resources
  2. Tax rates & allowances

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. A junior version of EIS the SEIS is also available.

Maximum investment per annum: £1,000,000

Additional investment limit where investing in knowledge-intensive companies: £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 Seed Enterprise Investment Scheme (SEIS) 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. SEIS is a junior version of EIS.

Maximum investment per annum: £100,000

Income tax relief: 50%

CGT treatment on disposal if held for 3 years: Exempt

Capital gains from the disposal of other assets may be exempt up to £50,000 per annum by making an SEIS investment.

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.

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

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

Capital allowances Capital gains tax Child benefit Corporation tax Income tax Individual Savings Account (ISA) Inheritance tax Minimum wage National insurance Pensions Stamp duty & land taxes Statutory pay Tax reliefs for individuals Value added tax Vehicles

The latest news

09 May 2022

HMRC starts chasing up SEISS overpayments

HMRC has started to recover overpayments of Self-employment Income Support Scheme (SEISS) grants.

09 May 2022

UK government unveils energy strategy

Up to eight more nuclear reactors could be delivered to existing sites as part of the UK's new energy strategy.

09 May 2022

Treasury announces it will regulate some forms of cryptocurrency

The Treasury has announced that it plans to recognise stablecoins as a valid form of payment as part of a wider government initiative to 'make Britain a global hub for cryptoasset technology and investment'.

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Northampton Office: Chancery House, 52 Sheep Street, Northampton, Northamptonshire NN1 2LZ
Rugby Office: Sir Frank Whittle Business Centre, Great Central Way, Rugby, CV21 3XH

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