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EIS investment is more generous than ever for UK tax payers from 6th April

Posted 3 years ago

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From the 6th April EIS investing is even more generous for UK tax payers, as changes from the 2017 autumn budget come into effect. As we reported back in November, the Chancellor wishes to encourage more private investment into higher risk small company investment through EIS and is particularly keen that this money flows to ‘knowledge intensive’ companies, like those found in the technology sector.

EIS investors will, from 6 April, be able to earn double the tax relief of the 2017/18 tax year, that’s up to £600,000 based on 30% income tax relief on an investment that is doubling from £1 million to £2 million.

  • 30% upfront Income Tax relief up to maximum investment of £2 million (previously £1 million), which can be carried back to the previous tax year (assuming the investor has sufficient income tax liability), provided any investment over £1 million is made into a knowledge intensive company.
  • 100% Inheritance Tax relief (provided the investments have been held for at least 2 years at time of death)
  • No Capital gains tax after three years
  • Deferral of gains realised on a different asset, where disposal of that asset was less than 12 months before the EIS investment or less than 36 months after it
  • Tax-free growth
  • Tax relief from investment losses
  • If EIS shares are disposed of at any time at a loss, such loss can be set against the investor's capital gains or his income in the year of disposal.



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