TAX RELIEFS – REWARDS FOR SMART INVESTMENTS!

Changing times call for a revolutionary change in measures. Many countries have realised that the economic growth or its sustenance depends not just on its larger corporations and enterprises but also in the encouragement and advancement of smaller companies. Entrepreneurship is the new step in the evolution of stronger economies. Identifying such potentials and furthering their development seems to be the topmost priority of many countries and the UK is at the forefront. In April 2012, the UK government introduced a range of benefits for those who invest in the early stage or start-up companies.

The Seed Enterprise Investment Scheme that was introduced has revolutionised the entrepreneurial scene in the UK. This scheme serves to offer an impressive array of benefits to regular investors or those who wish to aid their friends and family by funding their dream projects. In the 2014 Budget, the Tax reliefs for such funding have been made permanent, making it one of the most beneficial opportunities for investors.

INCOME TAX RELIEF

Investors can claim up to 50% SEIS Income Tax Relief on subscriptions against income tax paid on total investments up to £100,000.

CGT INVESTMENT RELIEF

Investors, who are residents of UK, can obtain an exemption for CGT liabilities of 50% of the investment. This allows them to obtain further CGT relief of up to 14%. Therefore, the SEIS Income Tax Relief and CGT Reinvestment Relief combine to give a 64% in tax reliefs.

CARRY BACK FACILITY

The carry back facility in SEIS serves to extend the period for which CGT and / or income tax investment relief can be accessed.E.g. investments made in the 2014/15 tax year can be ‘carried-back’ and applied to liabilities occurred in the previous 2013/14 tax year.

SEIS LOSS RELIEF

Under circumstances where the shares an investor possesses in an Investee Company are sold at a loss (or in the event the investment fails completely), there are provisions to offset those losses against the income tax or CGT. Thus would however depend on the individual Investors’ circumstances and the overall limits as to how much can be offset. For top-rate taxpayers loss relief is 45% on their “actual” investment (the original amount less the 50% income tax relief) which would be 22.5% of the total.

CGT EXEMPT DISPOSAL

Capital Gains (profits) are tax free provided that:

  • The shares are held in a Qualifying company for a minimum period of three years post issue.
  • The SEIS Income Tax Relief has not been withdrawn.

INHERITANCE TAX RELIEF

100% IHT Relief may be claimed on an Investor’s estate in most circumstances once Qualifying Shares have been held for two years.

Those who wish to apply for shares in our funds may do so using the application form included within the Information Memorandums for each of our offers. Please click here to see our range of opportunities currently available for investment.