EIS is a valuable income tax relief available to individuals who invest in shares in certain qualifying companies.
The main features of EIS relief are:
- The relief is 30% of the equity investment
- The relief is used to reduce the income tax due in the year of the investment or the previous year
- There are detailed rules covering:
- Investor eligibility
- The qualifying activities for the company
- The amount of an individual investment
- The amount a company can raise
- If the shares are held for three years no CGT is payable on a future share sale
- There is a mass of detailed conditions which need to be reviewed