{"id":4271,"date":"2021-08-20T14:29:54","date_gmt":"2021-08-20T14:29:54","guid":{"rendered":"https:\/\/www.bainesjewitt.co.uk\/blog\/?p=4271"},"modified":"2021-08-20T14:29:56","modified_gmt":"2021-08-20T14:29:56","slug":"tax-relief-schemes-may-help-start-ups-raise-outside-investment-icaew","status":"publish","type":"post","link":"https:\/\/www.bainesjewitt.co.uk\/blog\/tax-relief-schemes-may-help-start-ups-raise-outside-investment-icaew\/","title":{"rendered":"Tax-relief schemes may help start-ups raise outside investment – ICAEW"},"content":{"rendered":"

Tax-relief schemes may help start-ups and established businesses attract outside investment when traditional investment is not viable, a major regulator has said.<\/p>\n

<\/p>\n

The Institute of Chartered Accountants in England and Wales (ICAEW) said initiatives, such as the seed enterprise investment scheme (SEIS) and the enterprise investment scheme (EIS), may help even the smallest of firms raise capital.<\/p>\n

One of four venture capital schemes, the SEIS<\/a> is designed to help start-ups raise money in the earliest stages of business by offering tax reliefs to individual investors who buy new shares in the company.<\/p>\n

While a business can only receive a maximum of \u00a3150,000 through SEIS investments, investors will get 50 per cent income tax relief on qualifying shares. In addition, any shares held by an investor for more than three years can be sold without incurring capital gains tax.<\/p>\n

To qualify, your business must be less than two years old and at the time of investment have no more than \u00a3200,000 in gross assets, fewer than 25 employees, and not previously carried out a different trade.<\/p>\n

The EIS<\/a>, meanwhile, is targeted at investors seeking to invest in established businesses. Scale-ups can raise up to \u00a35 million each year, up to a maximum \u00a312 million in a company\u2019s lifetime (including amounts raised from other venture capital schemes, such as the SEISS).<\/p>\n

Investors will receive 30 per cent income tax relief on qualifying shares under the EIS<\/p>\n

To qualify, your business must have no more than \u00a315 million in gross assets, fewer than 250 employees, and, at the time of investment, it has been more than seven years since your first commercial sale.<\/p>\n

Commenting on the report, the ICAEW said both schemes offer attractive tax relief for investors.<\/p>\n

\u201cWhen the opportunity arises, I recommend using that as a mechanism for raising funds,\u201d said author and ICAEW accountant Peter Tucker.<\/p>\n

He added: \u201cIn order for an investor to have confidence that they will get the tax relief, we recommend making an advance assurance application to HMRC that the proposed trade qualifies for EIS tax relief.\u201d<\/p>\n

Once approved, the company must submit the compliance statement EIS1, alongside other supporting documentation. This may include the company\u2019s business plan and financial forecasts, a copy of the latest accounts (if available), which companies will use the investments (if part of a group), and details of all trading and activities to be carried out.<\/p>\n

For help and advice with related matters, please get in touch with our corporate finance and accounting team today.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"

Tax-relief schemes may help start-ups and established businesses attract outside investment when traditional investment is not viable, a major regulator has said.<\/p>\n","protected":false},"author":2,"featured_media":4273,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[24,30,31,60,50,120,121,7,27,32],"tags":[],"_links":{"self":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4271"}],"collection":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/comments?post=4271"}],"version-history":[{"count":1,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4271\/revisions"}],"predecessor-version":[{"id":4272,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/posts\/4271\/revisions\/4272"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media\/4273"}],"wp:attachment":[{"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/media?parent=4271"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/categories?post=4271"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.bainesjewitt.co.uk\/blog\/wp-json\/wp\/v2\/tags?post=4271"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}