Looking to invest? The SEIS offers serious tax breaks to investors.
*Please note the information in this article may be out of date
HMRC are encouraging backers of new business start-up's to avail of the Seed Enterprise Investment Scheme. Offering tax relief of 50% on £100,000 invested and capital gains tax breaks up to 78%, the scheme should be of interest to anyone serious about inv
Wed, 16 Jan 2013The Scheme offers income tax relief of 50% on £100,000 invested and a capital gains tax holiday which has been extended to include money put into businesses up to April 2014, meaning CGT tax breaks of up to 78%. Is it any wonder that the Seed Enterprise Investment Scheme (SEIS) should be of interest to anyone looking to invest in new businesses.
In fact, the terms on offer to investors who partake of the scheme have been deemed "ridiculously generous" by Lord Young, the Government's enterprise advisor. Tax advisors are urging clients to consider the scheme, especially since loss relief measures included in the scheme mean that investors can write off over 100% of any money invested in a qualifying venture that failed. According to Angel investor Ms Dale Murray speaking to The Telegraph "It’s unbelievable – the Government is effectively underwriting your investment. Even very enterprising countries like the US and Israel have nothing that compares with SEIS,”
Some experts have argued that the investment cap of £150,000 has put investors off partaking in the scheme, as for some businesses, this sum would be considered insufficient to cover there initial growth costs. This could be one of the reasons for the low take up rate for the scheme.
HMRC have stated that the SEIS scheme has not been extended, but that investors can access capital gains relief until April 2014 in certain circumstances, because the scheme allows SEIS shares to be treated as if they were acquired in the previous tax year.
For more information on the SEIS scheme go to HMRC site here.