The Kingwood Partnership

ENTERPRISE INVESTMENT SCHEME (EIS)

The following tax reliefs are currently (2007) available to UK residents subscribing to shares in the company. In its present form the possible reliefs and benefits of an EIS are more extensive than ever.

We have obtained confirmation from HM Customs & Revenue that the company’s trade is a qualifying one and all qualifying investors will be entitled to claim the tax reliefs outlined below.

  • Deferral of all tax otherwise due on capital gains (no limit) made between March 2004 and March 2008 up to the amount subscribed or a further deferral of gains deferred by an earlier investment. Any gain arising on a disposal of the shares after three years shall be free of Capital Gains Tax.
  • Income tax relief at 20% of the amount subscribed (maximum £400,000 in any tax year). This relief is given in the tax year of subscription for the shares.
  • As a result of the above, an individual could have a total tax saving and deferral of 60% of their investment.
  • Losses on EIS shares qualify for income tax (or capital gains tax) relief at your top rate.
  • An investor cannot own more than 30% of the shares directly or indirectly.
  • Companies are eligible to subscribe under the corporate venturing rules providing corporation tax relief. If the company makes a profit on disposal of the shares, Corporation Tax will be payable at 20% of the profits up to £300,000 in each year.
  • This is an investment for a period of not less than three years and a disposal of shares before that time has elapsed will generally result in a claw back of all tax relief obtained as a result of the investment.

For further information we suggest you contact your own financial advisor.

The details expressed in this document and accompanying documents are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Kingwood Stud accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information.