Autumn Statement spells good news for EIS

Alice Murray
05 December 2013

Tweet
Facebook
LinkedIn
Google plus
Send to

The UK Chancellor’s Autumn Statement, released today, outlines more favourable and encouraging tax relief for the Enterprise Investment Scheme.

Although the exact terms are still to be announced, it is understood that investors committing to EIS funds may receive immediate tax relief.

The improved scheme comes as the BVCA launches a new framework to promote co-operation between angel investors and venture capital firms in deals using the EIS. The initiative gives angels the ability to invest alongside institutional funds in order to boost the deployment of the tax relief scheme.

The framework, which was developed by DFJ Esprit, provides a standard ‘term sheet' for investors in venture deals that use the EIS.

Furthermore, former 3i investment director and Hotbed Founder, Gary Robins, has launched Chancery Investment Partners, a new investment firm focused on taking advantage of the EIS, as well as offering investment opportunities under the recently launched Seed Investment Scheme.

The reforms made to the EIS last year mean that individuals can claim 30% of the cost of each investment against their income tax bill. The reforms have allowed a wider range of businesses that can be invested in (originally the scheme was aimed at start-ups and young companies). Target companies can be based almost entirely overseas and the amount of cash that can be raised by a business each year has increased to £5m.